162.%Leviton%Industries%v.%Hon.
%Serafin%Salvador%and%Leviton% ISSUE%WON%LM%has%the%capacity%to%sue%in%the%Philippines%even%
Manufacturing%Co.%
GR%No.%L>40163,%June%19,%1982%
FACTS%
!% On% April% 17,% 1973,% Leviton% Manuacturing% (LM)% filed% a%
complaint% for% unfair% competition% aagainst% Leviton% industries%
(LI).%(important%fact:%in%LM’s%complaint,%it%failed%to%allege%the%
authority%on%which%it%has%the%capacity%to%sue)%
!% LM%is%a%foreign%corporation%under%laws%of%New%York%and%that%
LI%is%a%partnership%organized%here%in%the%Philippines.%
!% LM% founded% in% 1906% by% Isidor% Leviton,% is% the% largest%
manufacturer%of%electrical%wiring%devices%in%the%United%States%
under%the%trademark%Leviton,%which%various%electrical%wiring%
devices% bearing% the% trademark% Leviton% and% trade% name%
Leviton% Manufacturing% Co.,% Inc.% had% been% exported% to% the%
Philippines%since%1954.%
!% LI% % began% manufacturing% and% selling% electrical% ballast,% fuse%
and%oval%buzzer%under%the%trademark%Leviton%and%trade%name%
Leviton%Industries%Co%and%its%generaal%manager%Domingo%Go%
registered% with% the% Philippine% Patent% Office% the% trademarks%
“Leviton%Label”%and%“Leviton”%%with%respect%to%ballast%and%fuse.%
!% LI% also% copied% the% design% used% by% LM% % in% distinguishing% its%
traddemark,% thereby% causing% confusion% in% the% midns% of% the%
consumers%
!% LI%%fled%a%motion%to%dismiss%stating%that%LM%failed%to%allege%its%
capacity%to%sue%under%Sec.%2ZA%of%RA%No.%166.%
!% Lower%court%denied%motion.%
though%it%is%not%registered%as%a%corporation%therein%
HELD%No.%LM%failed%to%allege%the%essential%facts%bearing%upon%its%
capacity%to%sue%in%the%Philippine%Courts.%
According%to%Sec.%21ZA%of%RA%No.%166:%
Sec.%21ZA.%Any%foreign%corporation%or%juristic%person%to%which%a%
mark%or%tradename%has%been%registered%or%assigned%under%this%
Act% may% bring% an% action% hereunder% for% infringement,% for% unfair%
competition,%or%false%designation%of%origin%and%false%description,%
whether% or% not% it% has% been% licensed% to% do% business% in% the%
Philippines% under% Act% numbered% Fourteen% Hundred% and% FiftyZ
Nine,%as%amended,%otherwise%known%as%the%Corporation%Law,%at%
the% time% it% brings% the% complaint`% Provided,% That% the% country% of%
which%the%said%foreign%corporation%or%juristic%person%is%a%citizen,%
or%in%which%it%is%domiciled,%by%treaty,%convention%or%law,%grants%a%
similar%privilege%to%corporate%or%juristic%persons%of%the%Philippines.%
(As%amended%by%R.A.%No.%638).%
LM% ,should% have% complied% with% the% following% (REFER% TO% THE%
DOCTRINE)%in%order%to%have%been%granted%capacity%to%sue%in%the%
Philippine%courts:%
DOCTRINE%
1.The% % registration% of% the% trademark% of% the% suing% foreign%
corporation%with%the%Philippine%Patent%Office%or,%in%the%least,%that%
it%be%an%asignee%of%such%registered%trademark.%
2.%The%country,%of%which%the%plaintiff%foreign%corporation%or%juristic%
person%is%a%citizen%or%domicilliary,%grants%to%Filipino%corporations%
or% juristic% entities% the% same% reciprocal% treatment,% either% through%
treaty,%convention%or%law.%
All%that%is%alleged%in%private%respondent's%complaint%is%that%it%is%a%
foreign%corporation.%Such%bare%averment%not%only%fails%to%comply%
with%the%requirements%imposed%by%the%aforesaid%Section%21ZA%but%
violates%as%well%the%directive%of%Section%4,%Rule%8%of%the%Rules%of%
Court%that%"facts%showing%the%capacity%of%a%party%to%sue%or%be%sued%
or%the%authority%of%a%party%to%sue%or%be%sued%in%a%representative%
capacity% or% the% legal% existence% of% an% organized% association% of%
persons%that%is%made%a%party,%must%be%averred.%
Puma% Sportschuhfabriken% Rudolf% Dassler,% K.G.% vs.% ISSUE:% WON% CA% is% correct% in% finding% that% the% case% should% be%
Intermediate%Appellate%Court! dismissed% by% reason% of% litis" pendentia" and% no% legal% capacity% to%
No.%LZ75067.%February%26,%1988% sue.%
%
DOCTRINE% HELD%–%NO.%
A%foreign%corporation%not%doing%business%in%the%Philippines% %
needs% no% license% to% site% before% Philippine% courts% for% Petitioner%has%capacity%to%sue%
infringement%of%trademark%and%unfair%competition." %
" 1.%The%reciprocity%is%not%needed%to%be%alleged%between%Ph.%and%
FACTS% Ger.%in%the%complaint.%
1.% Petitioner,% a% foreign% corporation% duly% organized% and% existing% 2.%Such%reciprocity%arrangement%is%embodied%in%and%supplied%by%
under% the% laws% of% the% Federal% Republic% of% Germany% and% the% the% Union% Convention% for% the% Protection% of% Industrial%
manufacturer% and% producer% of% "PUMA% PRODUCTS,"% filed% a% Property%(Paris%Convention)%to%which%both%the%Philippines%and%
complaint%for%infringement%of%patent%or%trademark%with%a%prayer% Federal%Republic%of%Germany%are%signatories%and%that%since%the%
for% the% issuance% of% a% writ% of% preliminary% injunction% against% the% Paris%Convention%is%a%treaty%which,%pursuant%to%our%Constitution,%
private%respondent%before%the%Regional%Trial%Court%of%Makati.% forms%part%of%the%law%of%the%land.%
% 3.% The% object% of% the% Convention% is% to% accord% a% national% of% a%
2.%Prior%to%the%filing%of%the%said%civil%suit,%three%cases%were%pending% member% nation% extensive% protection% 'against% infringement% and%
before%the%Philippine%Patent%Office%against%the%Private%respondent% other%types%of%unfair%competition'.%%
MILZORO% MANUFACTURING% CORPORATION.% MILZORO% %
wants%to%register%trademark%for%'PUMA%and%DEVICE'.% No%Litis!Pendentia%
% %
3.%Private%respondent%filed%a%Motion%to%Dismiss%before%the%RTC% 1.% Anent% the% issue% of" lis" pendens" as% a% ground% for% a% motion% to%
Makati%on%the%grounds%of%litis"pendentia%and%that%petitioner%has%no% dismiss,%the%petitioner%submits%that%the%relief%prayed%for%in%its%civil%
legal%capacity%to%sue.% action%is%different%from%the%relief%sought%in%the%Inter%Partes%cases.%
% 2.% The% other% case% is% not% a% pending% court% action.% PPO% is% not% a%
4.% RTC% denied% the% MTD.% On% appeal,% CA% reverse% RTC% and% court.%
dismissed%the%case.% %
%
5.%CA%said%that%Petitioner%has%no%capacity%to%sue%because%there%
is%no%allegation%that%there%is%reciprocity%in%the%complaint.%%
%
%
164%La%Chemise%Lacoste%Vs.%Fernandez%
Nature:% It% is% undeniable% from% the% records% that% it% is% the% actual%
owner%of%the%trademarks%used%on%clothings%and%other%goods%which%
have% been% marketed% in% the% Philippines% since% 1964.% The% main%
basis%of%the%private%respondent’s%case%is%its%claim%of%alleged%prior%
registration.%
Facts:%%
•% La%chemise%Lacoste%is%a%French%corporation%and%the%actual%
owner% of% the% trademarks% “Lacoste,”“Chemise% Lacoste,”%
“Crocodile%Device”%and%a%composite%mark%consisting%of%the%
word% “Lacoste”% and% a% representation% of% a%
crocodile/alligator,%used%on%clothing's%and%other%goods%sold%
in%many%parts%of%the%world%and%which%has%been%marketed%
in%the%Philippines%(notably%by%Rustans)%since%1964.%
•% In%1975%and%1977,%Hemandas%Q.%Co.,%a%domestic%firm,%was%
issued% certificate% of% registration% for% the% trademark%
“Chemise% Lacoste% and% Q% Crocodile% Device% "both% in% the%
supplemental%and%Principal%Registry.%%
•% In%1980,%La%Chemise%Lacoste%SA%filed%for%the%registration%
of% the% “Crocodile% device”% and% “Lacoste”.% Games% and%
Garments%(Gobindram%Hemandas,%assignee%of%Hemandas%
Q.Co.)%opposed%the%registration%of%“Lacoste.”%
•% In% 1983,% La% Chemise% Lacoste% filed% with% the% NBI% a% letterZ
complaint%alleging%acts%of%unfair%competition%committed%by%
Hemandas% and% requesting% the% agency’s% assistance% for%
investigation%and%prosecution.%
•% A% search% warrant% was% issued% by% the% trial% court.% Various%
goods%and%articles%were%seized%upon%the%execution%of%the%
warrants.% Hemandas% filed% motion% to% quash% the% warrants,%
alleging% that% its% trademark% was% different% from% petitioner’s%
trademark.% Court% granted% pet’s% motion.% The% search%
warrants% were% recalled,% and% the% goods% ordered% to% be%
returned.%La%Chemise%Lacoste%filed%a%petition%for%certiorari.%
%
Issue/s:% Whether% or% not% petitioner’s% trademark% is% a% wellZknown%
mark%protected%under%the%Paris%Convention.%
Ruling:%YES.%
%
In% upholding% the% right% of% the% petitioner% to% maintain% the%
present% suit% before% our% courts% for% unfair% competition% or%
infringement% of% trademarks% of% a% foreign% corporation,% we% are%
moreover%recognizing%our%duties%and%the%rights%of%foreign%states%
under% the% Paris% Convention% for% the% Protection% of% Industrial%
Property%to%which%the%Philippines%and%France%are%parties.%
%
Pursuant%to%this%obligation,%the%Ministry%of%Trade%issued%a%
memorandum% addressed% to% the% Director% of% the% Patents% Office%
directing%the%latter%to%reject%all%pending%applications%for%Philippine%
registration%of%signature%and%other%world%famous%trademarks%by%
applicants%other%than%its%original%owners%or%users.%The%conflicting%
claims%over%internationally%known%trademarks%involve%such%name%
brands%as%Lacoste,%et.%al.%It%is%further%directed%that,%in%cases%where%
warranted,% Philippine% registrants% of% such% trademarks% should% be%
asked%to%surrender%their%certificates%of%registration,%if%any,%to%avoid%
suits% for% damages% and% other% legal% action% by% the% trademarks’%
foreign%or%local%owners%or%original%users.%
%
The% Intermediate% Appellate% Court,% in% the% La" Chemise"
Lacoste"S.A."v."Sadhwani%decision%which%we%cite%with%approval%
sustained% the% power% of% the% Minister% of% Trade% to% issue% the%
implementing% memorandum% and% declared% La% Chemise% Lacoste%
S.A.%the%owner%of%the%disputed%trademark,%stating:%“In%the%case%at%
bar,% the% Minister% of% Trade,% as% ‘the% competent% authority% of% the%
country%of%registration,’%has%found%that%among%other%wellZknown%
trademarks%‘Lacoste’%is%the%subject%of%conflicting%claims.%For%this%
reason,% applications% for% its% registration% must% be% rejected% or%
refused,%pursuant%to%the%treaty%obligation%of%the%Philippines.”%
%
Since%it%is%the%trade%and%not%the%mark%that%is%to%be%
protected,% a% tradeZmark% acknowledges% no% territorial%
boundaries% of% municipalities% or% states% or% nations,% but%
extends% to% every% market% where% the% trader's% goods% have%
become%known%and%Identified%by%the%use%of%the%mark.%

Inasmuch% as% the% goodwill% and% reputation% of% La% Chemise%

Lacoste%products%date%back%even%before%1964,%Hemandas%cannot%
be% allowed% to% continue% the% trademark% “Lacoste”% for% the% reason%
that%he%was%the%first%registrant%in%the%Supplemental%Register%of%a%
trademark% used% in% international% commerce.% % Registration% in% the%
Supplemental% Register% cannot% be% given% a% posture% as% if% the%
registration%is%in%the%Principal%Register.%%It%must%be%noted%that%one%
may% be% declared% an% unfair% competitor% even% if% his% competing%
trademark%is%registered.%%La%Chemise%Lacoste%is%world%renowned%
mark,%and%by%virtue%of%the%20%November%1980%Memorandum%of%
the%Minister%of%Trade%to%the%director%of%patents%in%compliance%with%
the% Paris% Convention% for% the% protection% of% industrial% property,%
effectively% cancels% the% registration% of% contrary% claimants% to% the%
enumerated%marks,%which%include%“Lacoste"%
%

%
Romero%vs.%Maiden%Form%Brassiere%Co.,%Director%of%Patents%
FACTS:%
% Maiden%Form,%a%foreign%corporation,%filed%with%the%Director%
of% Patents% an% application% for% registration% of% the% trademark%
“Adagio”%for%the%brassieres%manufactured.%It%alleged%that:%
-% First%used%by%it%in%the%United%States%on%October%26,%1937,%
and%in%the%Philippines%on%August%31,%1946`%%
-% It%had%been%continuously%used%by%it%in%trade%in,%or%with%the%
Philippines%for%over%30%years`%
-% That% said% trademark% "is% on% the% date% of% this% application,%
actually% used% by% respondent% company% on% the% following%
goods,%classified%according%to%the%official%classification%of%
goods%(Rule%82)—Brassieres,%Class%40"`%
-% and%that%said%trademark%is%applied%or%affixed%by%respondent%
to%the%goods%by%placing%thereon%a%woven%label%on%which%
the%trademark%is%shown.%
% -%
Director% of% Patents% approved% for% publication% in% the% Official%
Gazette%said%trademark%of%Maiden%Form%company%in%accordance%
with% Section% 7% of% Republic% Act% No.% 166% (Trademark% Law),%
having%found,%inter"alia,""
-% that% said% trademark% is% "a% fanciful% and% arbitrary% use% of% a%
foreign%word%adopted%by%applicant%as%a%trademark%for%its%
product`%%
-% that%it%is%neither%a%surname%nor%a%geographical%term,%nor%
any%that%comes%within%the%purview%of%Section%4%of%Republic%
Act%No.%166`%%
-% and% that% the% mark% as% used% by% respondent% company%
convincingly% shows% that% it% identifies% and% distinguishes%
respondent%company's%goods%from%others."%
% just%a%style%of%bra:%“Maidenform"bras"are"packaged"for"your"
Romero%filed%a%petition%for%cancellation%of%said%trademark%on%
the%grounds:%
-% that% it% is% a% common% descriptive% name% of% an% article% or%
substance%on%which%the%patent%has%expired`%
-% that%its%registration%was%obtained%fraudulently%or%contrary%
to%the%provisions%of%Section%4,%Chapter%II%of%Republic%Act%
No.%166`%%
-% and%that%the%application%for%its%registration%was%not%filed%in%
accordance%with%the%provisions%of%Section%37,%Chapter%XI%
of%the%same%Act.%
-% that% said% trademark% has% not% become% distinctive% of%
respondent%company's%goods%or%business`%%
-% that%it%has%been%used%by%Maiden%company%to%classify%the%
goods% (the% brassieres)% manufactured% by% it,% in% the% same%
manner%as%Romero%uses%the%same`%%
-% that%said%trademark%has%been%used%by%Romero%for%almost%
6%years`%%
-% that%it%has%become%a%common%descriptive%name`%%
and% that% it% is% not% registered% in% accordance% with% the%
requirements%of%Section%37%(a),%Chapter%XI%of%Republic%Act%
No.%166.%
%
ISSUE:%Whether%the%trademark%“Adagio”%has%become%a%common%
descriptive% name% of% a% particular% style% of% brassiere% and% is%
therefore,%unregistrable.%
%
HELD:%NO%
%%
-% Romero%claims%that%the%use%of%the%word%“Adagio”%is%only%to%
designate%a%particular%style%or%quality%of%brassiere%and%
therefore%is%unregistrable%as%a%trademark.%And%because%of%
these%words%printed%on%the%package%suggests%that%it%is%
quick" shopping" convenience." For" other" popular"
Maidenform"styles"write"for"free"style"booklet"to:"Maiden"
 Form"Brassiere"Co.,"Inc.,"200"Madison"Avenue,"New"York"
16,"N.Y."%%
The% trademark% "Adagio"% is% a% musical% term,% which%
means%slowly%or%in%an%easy%manner,%and%when%applied%to%
brassieres% is% used% in% an% arbitrary% (fanciful)% sense,% not%
being%a%common%descriptive%name%of%a%particular%style%of%
brassieres,%and%is%therefore%registrable.%
-% It%is%not%true%that%Maiden%Form%did%not%object%to%the%use%of%
“Adagio”% by% local% brassiere% manufacturers% and% Romero%
since%1948.%%
% The% records% show% that% Maiden% Form’s% agent,% Mr.%
Schwartz,% warned% the% Valleson% Department% Store% to%
desist% from% the% sale% of% the% "Adagio"% Royal% Form%
brassieres%manufactured%by%Romero%and%even%placed%an%
advertisement%in%the%local%newspapers%warning%the%public%
against%unlawful%use%of%said%trademark%
-% Maiden%Form’s%long%and%continuous%use%of%the%trademark%
"Adagio"% has% not% rendered% it% merely% descriptive% of% the%
product.%%
-% Romero% claims% that% the% Director% of% Patents% erred% in%
registering% the% trademark% despite% Maiden’s% non>
compliance%with%Sec.%37%of%RA%166.%
This% is% untenable.% Maiden’s% application% was% filed%
under% the% provisions% of% Section% 2% of% Republic% Act% No.%
166%not%under%Sec.%37.%
"SEC.%2.%What"are"registrable.—Trademarks,%x%x%x%
owned% by% persons,% corporations,% partnerships% or%
associations%domiciled%x%x%x%in%any%foreign%country%may%be%
registered% in% accordance% with% the% provisions% of% this% Act:%
Provided," That% said% trademarks,% tradenames,% or% service%
marks%are%actually%in%use%in%commerce%and%services%not%
less%than%two%months%in%the%Philippines%before%the%time%the%
applications%for%registration%are%filed:%x%x%x"%
Section% 37% of% RA% 166% is% not% applicable% here%
because%it%can%only%be%applied%if%Philippines%is%a%party%to%
an% international% convention% or% treaty% relating% to%
trademarks.%However,%Philippines%has%not%yet%entered%into%
any%such%treaty%or%convention.%
Sec.%37%does%not%require%actual%use%as%long%as%there%
is% a% treaty.% Thus,% in% this% case,% actual% use% is% required.%
Maiden%Form%had%proved%actual%use%since%1946.%
-% There%was%a%contention%that%Maiden%Form%abandoned%the%
use% of% “Adagio”% when% the% Government% imposed%
restrictions% on% importation% of% Maiden’s% Brassieres.% Court%
held%that%temporary%nonZuse%of%a%trademark%occasioned%by%
government% restrictions% not% being% permanent,% intentional%
and%voluntary,%does%not%affect%the%right%to%a%trademark.%%
%
PETITION%DENIED.%
%
CASE% 166:% PHILIPPINE% NUT% INDUSTRY,% INC.,% % vs.%
STANDARD% BRANDS% INCORPORATED% and% TIBURCIO% S.%
EVALLE%as%Director%of%Patents%
G.R.%No.%L>23035%July%31,%1975%
PONENTE:%Munoz%Palma%
TOPIC:%Cancellation%%
%
DOCTRINE:%There%is%infringement%of%trademark%when%the%use%of%
the%mark%involved%would%be%likely%to%cause%confusion%or%mistake%
in%the%mind%of%the%public%or%to%deceive%purchasers%as%to%the%origin%
or%source%of%the%commodity.%%
%
FACTS:%
•%August% 10,% 1961Z% Philippine% Nut,% a% domestic% corporation,%
obtained%from%the%Patent%Office,%Certificate%of%Registration%No.%
SRZ416% covering% the% trademark% "PHILIPPINE% PLANTERS%
CORDIAL%PEANUTS,"%the%label%used%on%its%product%of%salted%
peanuts.%
•%May%14,%1962Z%Standard%Brands,%a%foreign%corporation,%filed%
with%the%Director%of%Patents%Inter%Partes%Case%No.%268%asking%
for%the%cancellation%of%Philippine%Nut's%certificate%of%registration%
on%the%ground%that%"the%registrant%was%not%entitled%to%register%
the%mark%at%the%time%of%its%application%for%registration%thereof"%
for% the% reason% that% it% (Standard% Brands)% is% the% owner% of% the%
trademark% "PLANTERS% COCKTAIL% PEANUTS"% covered% by%
Certificate%of%Registration%No.%SRZ172,%issued%by%the%Patent%
Office% on% July% 28,% 1958.% Standard% Brands:% Alleged% that%
Philippine% Nut's% trademark% "PHILIPPINE% PLANTERS%
CORDIAL% PEANUTS"% closely% resembles% and% is% confusingly%
similar%to%its%trademark%"PLANTERS%COCKTAIL%PEANUTS"%
used%also%on%salted%peanuts,%and%that%the%registration%of%the%
former% is% likely% to% deceive% the% buying% public% and% cause%
damage%to%it.%
•%Director% of% Patents:% ordered% the% cancellation% of% Philippine%
Nut's%Certificate%of%Registration%No.%SR>416.%In%the%labels%
using%the%two%trademarks%in%question,%the%dominant"part"is"the"
word""Planters",%displayed%"in%a%very%similar%manner"%so%much%
so%that%"as%to%appearance%and%general%impression"%there%is%"a%
very% confusing% similarity,"% and% he% concluded% that% Philippine%
Nut%"was%not%entitled%to%register%the%mark%at%the%time%of%its%filing%
the% application% for% registration"% as% Standard% Brands% will% be%
damaged%by%the%registration%of%the%same.%
•%Its%motion%for%reconsideration%having%been%denied,%Philippine%
Nut%came%up%to%this%Court%for%a%review%of%said%decision.%
•%Petitioner’s%arguments:%
a.% PLANTERS% cannot% be% considered% as% the% dominant%
feature%of%the%trademarks%in%question%because%it%is%a%mere%
descriptive%term.%
b.% Respondent%Director%should%not%have%based%his%decision%
simply%on%the%use%of%the%term%PLANTERS,%and%that%what%
he%should%have%resolved%is%whether%there%is%a%confusing%
similarity%in%the%trademarks%of%the%parties.%
%
ISSUE:% WON% the% trademark% "PHILIPPINE% PLANTERS%
CORDIAL% PEANUTS"% used% by% Philippine% Nut% on% its% label% for%
salted%peanuts%confusingly"similar"to%the%trademark%"PLANTERS%
COCKTAIL%PEANUTS"%used%by%Standard%Brands%on%its%product%
constitutes% an% infringement% of% the% latter's% trademark% rights% and%
justify%its%cancellation?%%
%
HELD/RATIO:%
YES.%PLANTERS%is%used%in%the%labels%not%to%describe%the%nature%
of% the% product,% but% to% project% the% source% or% origin% of% the% salted%
peanuts% contained% in% the% cans.% The% word% PLANTERS% printed%
across%the%upper%portion%of%the%label%in%bold%letters%easily%attracts%
and%catches%the%eye%of%the%ordinary%consumer%and%it%is%that%word%
and%none%other%that%sticks%in%his%mind%when%he%thinks%of%salted%
peanuts.%
•% It%is%true%that%there%are%other%words%used%such%as%"Cordial"%in%
petitioner's%can%and%"Cocktail"%in%Standard%Brands',%which%are%
also% prominently% displayed,% but% these% words% are% mere%
adjectives% describing% the% type% of% peanuts% in% the% labeled%
containers%and%are%not%sufficient%to%warn%the%unwary%customer%
that%the%two%products%come%from%distinct%sources.%
•% It%is%quite%obvious%from%the%record,%that%respondent%Director's%
 decision% is% based% not% only% on% the% fact% that% petitioner% herein%
adopted%the%same%dominant%mark%of%Standard%Brands,%that%is,%
the%word%PLANTERS,%but%that%it%also%used%in%its%label%the%same%
coloring% scheme% of% gold,% blue,% and% white,% and% basically% the%
same%layZout%of%words%such%as%"salted%peanuts"%and%"vacuum%
packed"%with%similar%type%and%size%of%lettering%as%appearing%in%
Standard% Brands'% own% trademark,% all% of% which% result% in% a%
confusing%similarity%between%the%two%labels.%%
•% Referring% again% to% the% picture% We% have% reproduced,% the%
striking%similarity%between%the%two%labels%is%quite%evident%not%
only%in%the%common%use%of%PLANTERS%but%also%in%the%other%
words%employed.%As%a%matter%of%fact,%the%capital%letter%"C"%of%
petitioner's% "Cordial"% is% alike% to% the% capital% "C"% of% Standard's%
"Cocktail",%with%both%words%ending%with%an%"1".%
•% Admittedly,% no% producer% or% manufacturer% may% have% a%
monopoly%of%any%color%scheme%or%form%of%words%in%a%label.%But%
when%a%competitor%adopts%a%distinctive%or%dominant%mark%or%
feature%of%another's%trademark%and%with%it%makes%use%of%the%
same%color%ensemble,%employs%similar%words%written%in%a%style,%
type%and%size%of%lettering%almost%identical%with%those%found%in%
the%other%trademark,%the%intent%to%pass%to%the%public%his%product%
as% that% of% the% other% is% quite% obvious.% Hence,% there% is% good%
reason%for%Standard%Brands'%to%ask%why%did%petitioner%herein%
use%the%word%PLANTERS,%the%same%coloring%scheme,%even%
almost%identical%size%and%contour%of%the%cans,%the%same%layZ
out%of%words%on%its%label%when%there%is%a%myriad%of%other%words,%
colors,%phrases,%symbols,%and%arrangements%to%choose%from%
to%distinguish%its%product%from%Standard%Brands,%if%petitioner%
was%not%motivated%to%simulate%the%label%of%the%latter%for%its%own%
can%of%salted%peanuts,%and%thereby%deceive%the%public?%
[No.%LZ8004.%May%30,%1956]%

ANCHOR% TRADING% Co.,% INC.,% petitioner,% vs.% THE% DIRECTOR%

OF%PATENTS%and%KUA%LIAN%HAM,%respondents.%

Appeal%from%the%decision%of%the%Director%of%Patents%ordering%the%
cancellation%of%Certificate%of%Registration%No.%3739%issued%in%favor%
of%petitioner%for%the%use%of%the%trademark%in%question.%The%principal%
legal% issue% here% is% whether% or% not% the% failure% of% respondentZ
appellee%to%register%his%opposition%to%the%petition%for%registration%
in% due% time% estops% him% from% asking% for% the% cancellation% of% the%
certificate%of%registration%issued%in%favor%of%petitionerZ%appellant.%
The% issue% should% be% resolved% in% the% negative.% The% only%
consequence%resulting%from%a%late%filing%of%an%opposition%to%any%
application%for%registration%of%

A% % trademark% is% the% oppositor's% relinquishment% of% the% privilege%

given% to% him% by% laws% to% object% to% such% registration,% but% such%
cannot%prevent%him%from%asking%later%for%its%cancellation%when%in%
his% opinion% there% are% good% grounds% justifying% it% (Section% 17,%
Republic%Act%No.%166).%

Judgment%appealed%from%affirmed,%wthout%pronouncement%as%to%
costs.%Bautista%Angelo,%J.,%ponente.%

%%
CLOROX%COMPANY%v.%THE%DIRECTOR%OF%PATENTS%
GR%No.%LZ19531%|%Aug.%10,%1967%|%J.%Angeles%%
% the%misfiling%of%its%verified%opposition%
FACTS%
•% Go%Siu%Gian%filed%with%the%Patent%Office%an%application%for%
registration%of%the%trademark%"OLDROX,"%with%an%
accompanying%statement%that%he%is%a%citizen%of%China,%
residing%and%doing%business%in%the%Philippines%at%838%
Folgueras%St.,%Manila`%that%he%has%adopted%the%trademark%
"OLDROX"%for%his%goods%(whitening%agent%for%bleaching)%
in%trade%and%commerce%in%the%country`%and%that%said%
trademark,%shown%on%printed%labels%affixed%to%the%goods,%
or%to%the%containers%thereof,%has%been%used%by%him%since%
February%1,%1959.%
•% On%September%21%of%the%same%year,%or%within%30%days%
from%the%date%of%its%publication%in%the%Official%Gazette,%an%
unverified%opposition%to%the%application%was%filed%by%the%
law%firm%Lichauco,%Picazo%and%Agcaoili%in%behalf%of%the%
Clorox%Company,%herein%petitioner.%
•% Director%of%Patents%issued%the%order%appealed%from,%
dismissing%the%petitioner's%opposition%to%the%application%
upon%the%ground,%which%is%stated%in%said%order,%that%the%
Clorox%Company%failed%to%file%the%required%verified%notice%
of%opposition%within%the%period%allowed%by%law.%%
•% Petitioner's%counsel%filed%a%motion%with%the%Patent%Office,%
dated%January%10,%1961,%advising%that%it%has%filed%the%
verified%notice%of%opposition%on%time,%i.e.,%on%November%
16,%1960`%although%it%also%admitted%that%the%covering%letter%
of%said%verified%opposition%was%given%another%case%
number%
•% Before%the%motion%could%be%acted%upon%by%the%Director%of%
Patents,%petitioner%filed%on%January%26,%1961,%a%petition%
for%relief%from%the%order%dismissing%its%opposition,%alleging%
circumstances%constituting%mistake%or%excusable%
negligence%of%its%counsel%and%his%employee%which%led%to%
•% The%Director%of%Patents%issued%the%resolution%of%February%
12,%1962,%also%appealed%from,%denying%both%the%motion%
and%the%petition%for%relief,%and%ordering%the%issuance%of%
the%Certificate%of%Registration%of%the%trademark%
"OLDROX"%in%the%name%of%Go%Siu%Gian%
%
ISSUE%
WON%the%decision%of%the%Director%of%Patents%was%correct%
%
HELD%
No.%Case%remanded%to%IPO.%%
•% There%is%no%question%that%petitioner's%counsel%filed%an%
unverified%notice%of%opposition%to%the%application%for%
registration%of%the%trademark%"OLDROX"%within%30%days%
from%the%date%of%its%publication%in%the%Official%Gazette.%
There%is%no%disagreement%also%that%the%record%of%the%case%
shows%that%an%unverified%opposition%was%filed,%and%it%was%
for%this%reason%that%the%order%of%January%8,%1961,%was%
issued,%because%the%law%requires%that%for%an%opposition%to%
be%valid,%it%must%be%verified.%It%is%not%disputed,%however,%
that%immediately%after%it%received%the%notice%of%dismissal%
of%its%opposition,%petitioner,%in%due%time,%filed%a%motion%
dated%January%10,%1961,%advising%the%Director%of%Patents%
that%its%verified%opposition%was%filed%on%time,%although%it%
admitted%its%error%in%submitting%it%under%a%covering%letter%
designating%another%opposition%case.%Under%the%
circumstances,%it%is%our%considered%opinion%that%the%
verified%opposition%mentioned%was%filed%on%time,%although%
it%was%submitted%under%an%erroneous%covering%letter.%
•% The%order%of%herein%respondent%dismissing%the%opposition%
of%petitioner%to%the%registration%of%the%trademark%in%
question%may%amount%to%considerable%injustice%to%the%
opposer%Clorox%Company,%the%order%having%been%entered%
not%upon%the%merits%of%the%controversy`%and%the%possibility%
of%such%serious%consequences%necessitates%a%careful%
examination%of%the%grounds%upon%which%it%requests%that%
the%order%be%set%aside.%It%must%be%remembered%that%the%
only%discretion%conferred%upon%officers%is%a%legal%
discretion,%and%when%anything%is%left%to%any%officer%to%be%
done%according%to%his%discretion,%the%law%intends%it%to%be%
done%with%a%sound%discretion%and%according%to%law%
(Coombs%vs.%Santos,%24%Phil.%446).%And%when,%as%in%this%
case,%the%allegation%of%the%pleading%clearly%show%
circumstances%constituting%mistake%and%excusable%
negligence%which%are%grounds%for%a%motion%for%
reconsideration%of%the%order%in%question,%a%dismissal%of%
the%motion%and%a%denial%of%the%relief%sought%upon%the%
flimsy%excuse%that%the%same%was%filed%as%a%petition%for%
relief,%will%amount%to%an%abuse%of%that%discretion.%%
%
%
WOLVERINE%WORLDWIDE,%INC.%V.%CA,%169%SCRA%627%
(1989)%
SARMIENTO,%J.%
% connection% with% the% goods% he% sells% constitutes% an%
DOCTRINE:%R.A.%166%provides:%".%.%.%The%owner%of%a%trademark,%
trade% name% or% serviceZmark% used% to% distinguish% his% goods,%
business% or% services% from% the% goods,% business% or% services% of%
others%shall%have%the%right%to%register%the%same%on%the%principal%
register.%.%Trademark%Law,%allows%the%cancellation%of%a%registered%
trademark%is%not%a%valid%premises%for%the%petitioner’s%proposition%
that% a% decision% granting% registration% of% a% trademark% cannot% be%
imbued%with%the%character%of%absolute%finality%as%is%required%in%res%
judicata.%%
% in%favor%of%Ramon%Angeles,%the%respondent's%predecessorZ
FACTS%
1.% Wolverine,% Inc% is% a% foreign% corporation% organized% and%
existing%under%the%laws%of%the%United%States`%while%Cruz,%is%
a%Filipino%citizen%%
2.% Petitioner% brought% a% petition% before% the% Philippine% Patent%
Office%for%the%cancellation%of%Certificate%of%Registration%of%
the%trademark%HUSH%PUPPIES%and%DOG%DEVICE%issued%
to%the%respondent%%
3.% Allegations%of%the%complaint%contained:%%
a.% It% is% the% registrant% of% the% internationally% known%
trademark% HUSH% PUPPIES% and% the% DEVICE% of% a%
Dog% in% the% US% and% in% other% countries% which% are%
members%of%the%Paris%Convention%for%the%Protection%
of%Industrial%Property%%
b.% The% goods% sold% by% the% respondent% and% by% the%
petitioner% belong% to% the% same% class% such% that% the%
respondent's% use% of% the% same% trademark% in% PH%
(which% is% a% member% of% said% Paris% Convention)% in%
act% of% unfair% competition,% as% denied% in% the% Paris%
Convention%%
4.% Respondents% moved% to% dismiss% the% petition% on% the%
ground%of%res%judicata,%averring:%%
In% 1973,% or% more% than% 10% years% before% this% petition% was%
filed,%the%same%petitioner%filed%two%petitions%for%cancellation%
(Inter%Partes%Cases%Nos.%700%and%701)%and%was%a%party%to%
an%interference%proceeding%(Inter%Partes%Case%No.%709),%all%
of% which% involved% the% trademark% HUSH% PUPPIES% and%
DEVICE,% before% the% Philippine% Patent% Office,% and% the%
Director%of%Patents%had%ruled%in%all%three%inter%parties%cases%
inZinterest%%
5.% PH% Patent% Office% –% ruled% to% dismiss! petitionf% CA% –%
Affirmed!Patent%Office’s%decision%%
%
ISSUE:% WON% the% present% petition% for% cancellation% (Inter%
Partes%Case%No.%1807)%is%barred%by%res%judicata%in%the%light%of%
the%final%and%executory%decision%in%Inter%Partes%Cases%Nos.%
700%701,%and%709?%YES%
%
HELD:%It%must%be%stressed%anew%that,%generally,%the%fundamental%
principle%of%res%judicata%applies%to%all%cases%and%proceedings%in%
whatever%form%they%may%be.%The%Court%has%repeatedly%held%that%
for%a%judgment%to%be%a%bar%to%a%subsequent%case,%the%following%
requisites% must% concur:% (1)% it% must% be% a% final% judgment`% (2)% the%
%
court% which% rendered% it% had% jurisdiction% over% the% subject% matter%
and%the%parties`%(3)%it%must%be%a%judgment%on%the%merits`%and%(4)%
there% must% be% Identity% between% the% two% cases,% as% to% parties,%
subject%matter,%and%cause%of%action.%We%now%expressly%affirm%that%
this%principle%applies,%in%the%appropriate%cases,%to%proceedings%for%
cancellation% of% trademarks% before% the% Philippine% Patent.%
Undoubtedly,% final% decision,% orders% and% resolutions,% of% the%
Director%of%Patents%are%clothed%with%a%judicial%character%as%they%
are,%in%fact,%reviewable%by%the%Court%of%Appeals%and%by%the%SC.%
Contrary% to% the% petitioner’s% assertion,% the% judgment% in% the%
previous%cases%involving%respondent’s%trademark%registration%had%
long%since%become%final%and%executor.%%
% bars%the%petitioner%from%reopening,%by%way%of%another%petition%for%
That%Sec.%17%of%Republic%Act%166,%also%known%as%the%Trademark%
Law,% allows% the% cancellation% of% a% registered% trademark% is% not% a%
valid% premises% for% the% petitioner’s% proposition% that% a% decision%
granting% registration% of% a% trademark% cannot% be% imbued% with% the%
character%of%absolute%finality%as%is%required%in%res%judicata.%%
petitioner’s%predecessorZin%interest,%became%the%settled%law%in%the%
case.%%
%
To% stress,% the% aforesaid% cases,% involving% as% they% were% the%
registration% of% a% trademark,% necessarily% litigated% the% issue% of%
ownership%of%such%trademark%because%ownership%is,%indeed,%the%
basis%of%registration%of%a%trademark.%Thus,%Section%4%of%R.A.%166%
provides:%".%.%.%The%owner%of%a%trademark,%trade%name%or%serviceZ
mark%used%to%distinguish%his%goods,%business%or%services%from%the%
goods,% business% or% services% of% others% shall% have% the% right% to%
register%the%same%on%the%principal%register.%.%.%"%Res%judicata%now%
cancellation%(the%present%Inter%Partes%Case%No.%1807),%the%issue%
of%ownership%of%the%trademark%HUSH%PUPPIES.%Otherwise,%there%
will%never%be%an%end%to%litigation.%

A% judgment% or% order% is% final,% as% to% give% it% the% authority% of% res%
judicata,%if%it%can%no%longer%be%modified%by%the%court%issuing%it%or%
by%any%other%court.%In%the%case%at%bar,%the%decision%of%the%Court%of%
Appeals% affirming% that% of% the% Director% of% Patents,% in% the%
cancellation% cases% filed% in% 1973,% was% never% appealed% to% us.%
Consequently,% when% the% period% to% appeal% from% the% Court% of%
Appeals% to% this% Court% lapsed,% with% no% appeal% having% been%
perfected,% the% foregoing% judgment% denying% cancellation% of%
registration%in%the%name%of%private%respondent’s%predecessorZinZ
interest%but%ordering%cancellation%of%registration%in%the%name%of%the%
%
Shangri>la%v%CA%[2001]%
% with%the%RTC%a%complaint%for%infringement%and%damages%with%
DOCTRINE%
.%As%such,%Developers%Group's%Certificate%of%Registration%in%the%
principal%register%continues%as%"'prima%facie%evidence%of%the%
validity%of%the%registration,%the%registrant's%ownership%of%the%mark%
or%tradeZname,%and%of%the%registrant's%exclusive%right%to%use%the%
same%in%connection%with%the%goods,%business%or%services%
specified%in%the%certificate."%Since%the%certificate%still%subsists,%
Developers%Group%may%thus%file%a%corresponding%infringement%
suit%and%recover%damages%from%any%person%who%infringes%upon%
the%former's%rights.%
% Affairs,%Intellectual%Property%Office)%by%one%party%(Hotel),%the%
FACTS%
Facts:%On%June%21,%1988,%the%ShangriZLa%International%Hotel%
Management,%Ltd.,%ShangriZLa%Properties,%Inc.,%Makati%ShangriZ
La%Hotel%and%Resort,%Inc.%and%Kuok%Philippine%Properties,%Inc.,%
filed%with%the%Bureau%of%Patents,%Trademarks%and%Technology%
Transfer%(BPTTT)%a%petition%praying%for%the%cancellation%of%the%
registration%of%the%ShangriZLa%mark%and%“S”%device/logo%issued%
to%the%Developers%Group%of%Companies%Inc.,%on%the%ground%that%
the%same%was%illegally%and%fraudulently%obtained%and%
appropriated%for%the%latter’s%restaurant%business.%The%ShangriZLa%
Group%alleged%that%it%is%the%legal%and%beneficial%owners%of%the%
subject%mark%and%logo`%that%it%has%been%using%the%said%mark%and%
logo%for%its%corporate%affairs%and%business%since%March%1962%and%
caused%the%same%to%be%specially%designed%for%their%international%
hotels%in%1975,%much%earlier%than%the%alleged%first%use%by%the%
Developers%Group%in%1982.%%
% any%other%court%or%agency%from%assuming%jurisdiction%over%a%
Likewise,%the%ShangriZLa%Group%filed%with%the%BPTTT%its%own%
application%for%registration%of%the%subject%mark%and%logo.%The%
Developers%Group%filed%an%opposition%to%the%application.%%
Almost%three%(3)%years%later,%the%Developers%Group%instituted%
prayer%for%injunction.%When%the%ShangriZLa%Group%moved%for%the%
suspension%of%the%proceedings,%the%trial%court%denied%such%in%a%
Resolution.%%
%
The%ShangriZLa%Group%filed%a%petition%for%certiorari%before%the%CA%
but%the%CA%dismissed%the%petition%for%certiorari.%Hence,%the%
instant%petition.%%
%
Issue:%WON%despite%the%institution%of%an%Inter%Partes%case%for%
cancellation%of%a%mark%with%the%BPTTT%(now%the%Bureau%of%Legal%
adverse%party%(DG)%can%file%a%subsequent%action%for%infringement%
with%the%regular%courts%of%justice%in%connection%with%the%same%
registered%mark.%
%
Held:%Yes.%
%
Section%151.2%of%Republic%Act%No.%8293,%otherwise%known%as%the%
Intellectual%Property%Code,%provides,%as%follows%—%
%
SECTION%151.2.%Notwithstanding%the%foregoing%provisions,%the%
court%or%the%administrative%agency%vested%with%jurisdiction%to%
hear%and%adjudicate%any%action%to%enforce%the%rights%to%a%
registered%mark%shall%likewise%exercise%jurisdiction%to%determine%
whether%the%registration%of%said%mark%may%be%cancelled%in%
accordance%with%this%Act.%The%filing%of%a%suit%to%enforce%the%
registered%mark%with%the%proper%court%or%agency%shall%exclude%
subsequently%filed%petition%to%cancel%the%same%mark.%On%the%
other%hand,%the%earlier%filing%of%petition%to%cancel%the%mark%with%
the%Bureau%of%Legal%Affairs%shall%not%constitute%a%prejudicial%
%
question%that%must%be%resolved%before%an%action%to%enforce%the%
rights%to%same%registered%mark%may%be%decided.%(Italics%
provided)%
%
The%rationale%is%plain:%Certificate%of%Registration%No.%31904,%
upon%which%the%infringement%case%is%based,%remains%valid%and%
subsisting%for%as%long%as%it%has%not%been%cancelled%by%the%
Bureau%or%by%an%infringement%court.%As%such,%Developers%
Group's%Certificate%of%Registration%in%the%principal%register%
continues%as%"'prima%facie%evidence%of%the%validity%of%the%
registration,%the%registrant's%ownership%of%the%mark%or%tradeZ
name,%and%of%the%registrant's%exclusive%right%to%use%the%same%in%
connection%with%the%goods,%business%or%services%specified%in%the%
certificate."%Since%the%certificate%still%subsists,%Developers%Group%
may%thus%file%a%corresponding%infringement%suit%and%recover%
damages%from%any%person%who%infringes%upon%the%former's%
rights.%
%
IN>N>Out%Burger%v.%Sehwani%
G.R.%No.%179127f%%December%24,%2008%%
CHICOZNAZARIO,%J"
% %InZNZOut%Burger%sent%a%demand%letter%directing%Sehwani,%Inc.%to%
FACTS%
INZNZOUT%BURGER,%INC.,%a%business%entity%incorporated%under%
the%laws%of%California,%United%States%(US)%of%America,%which%is%a%
signatory% to% the% Convention% of% Paris% on% Protection% of% Industrial%
Property% and% the% Agreement% on% Trade% Related% Aspects% of%
Intellectual%Property%Rights%(TRIPS).%Petitioner%is%engaged%mainly%
in%the%restaurant%business,%but%it%has%never%engaged%in%business%
in%the%Philippines.%
Sehwani,%Incorporated%and%Benita%Frites,%Inc.%are%corporations%
organized%in%the%Philippines.%
On% 2% June% 1997,% INZNZOUT% filed% trademark% and% service% mark%
applications%with%the%Bureau%of%Trademarks%(BOT)%of%the%IPO%for%
INZNZOUT%and%INZNZOUT%Burger%&%Arrow%Design.%INZNZOUT%later%
found% out% that,% on% 31% May% 2000,% Sehwani% already% obtained%
Trademark%Registration%for%the%mark%IN%N%OUT%(the%inside%of%the%
letter%O%formed%like%a%star).%By%virtue%of%a%licensing%agreement,%
Benita% Frites,% Inc.% was% able% to% use% the% registered% mark% of%
Sehwani.%%
INZNZOUT%filed%before%the%Bureau%of%Legal%Affairs%(BLA)%of%the%
IPO% an% administrative% complaint% against% respondents% for% unfair%
competition% and% cancellation% of% trademark% registration% on% the%
ground% that% it% is% the% owner% the% INZNZOUT,% INZNZOUT% Burger% &%
Arrow% Design,% and% INZNZOUT% Burger% Logo% trademarks.% The%
trademarks% were% registered% with% the% Trademark% Office% of%
the%US%and%in%various%parts%of%the%world,%are%internationally%wellZ
known,%and%have%become%distinctive%of%its%business%and%goods%
through%its%long%and%exclusive%commercial%use.%
cease% and% desist% from% claiming% ownership% of% the% mark% “INZNZ
OUT”% and% to% voluntarily% cancel% its% trademark% registration.%
Sehwani%Inc.%did%not%accede%to%InZNZOut%Burger’s%demand%but%it%
expressed% its% willingness% to% surrender% its% registration% for% a%
consideration.%
ISSUE%
Whether% or% not% the% IPO% has% jurisdiction% over% complaints% for% IP%
right%violation%%%
HELD%
Yes%
The% IPO% (an% administrative% body)% has% jurisdiction% in% cases%
involving%provisions%of%the%IPC%(e.g.%unfair%competition)%due%to%the%
following%reasons:%
Section%10.%The"Bureau"of"Legal"Affairs.“The%Bureau%of%Legal%
Affairs%shall%have%the%following%functions:%
10.1% Hear% and% decide% opposition% to% the% application% for%
registration%of%marks`%cancellation%of%trademarks`%subject%to%the%
provisions% of% Section% 64,% cancellation% of% patents% and% utility%
models,% and% industrial% designs`% and% petitions% for% compulsory%
licensing%of%patents`%
10.2% (a)% Exercise% original% jurisdiction% in% administrative%
complaints% for% violations% of% laws% involving% intellectual%
property% rightsf% Provided,% That% its% jurisdiction% is% limited% to%
complaints% where% the% total% damages% claimed% are% not% less%
than% Two% hundred% thousand% pesos%
(P200,000):% Provided,% futher,% That% availment% of% the%
%
provisional%remedies%may%be%granted%in%accordance%with%the%
Rules%of%Court.%Xxx%
Xxx%
(vi)% The% cancellation% of% any% permit,% license,% authority,% or%
registration%which%may%have%been%granted%by%the%Office,%or%
the%suspension%of%the%validity%thereof%for%such%period%of%time%as%
the% Director% of% Legal% Affairs% may% deem% reasonable% which% shall%
not%exceed%one%(1)%year`%
Section%10%of%the%IP%code%conferring%upon%BLA_IPO%jurisdiction%
over% administrative% complaints% for% violations% of% intellectual%
property% rights,% is% a% general% provision,% which% prevails% over% the%
specific%provision%of%Section%163%of%the%IP%Code.%
Unquestionably,% petitioners% complaint,% which% seeks% the%
cancellation% of% the% disputed% mark% in% the% name% of%
respondent%Sehwani,%Incorporated,%and%damages%for%violation%of%
petitioners%intellectual%property%rights,%falls%within%the%jurisdiction%
of%the%IPO%Director%of%Legal%Affairs.%
%
%
Etepha%v.%Director%of%Patents%
G.R.%No.%L>20635,%March%31,%1966%
% that% it% is% "the% common% practice% in% the% drug% and% pharmaceutical%
Facts:%
On%April%23,%1959,%respondent%Westmont%Pharmaceuticals,%Inc.,%
a% New% York% corporation,% sought% registration% of% trademark%
"Atussin"% placed% on% its% "medicinal% preparation% of% expectorant%
antihistaminic,%bronchodilator%sedative,%ascorbic%acid%(Vitamin%C)%
used% in% the% treatment% of% cough".% The% trademark% is% used%
exclusively%in%the%Philippines%since%January%21,%1959.1%
Petitioner,%Etepha,%A.%G.,%a%Liechtenstin%(principality)%corporation,%
objected.% Petitioner% claims% that% it% will% be% damaged% because%
Atussin%is%so%confusedly%similar%to%its%Pertussin%(Registration%No.%
6089,%issued%on%September%25,%1957)%used%on%a%preparation%for%
the%treatment%of%coughs,%that%the%buying%public%will%be%misled%into%
believing% that% Westmont's% product% is% that% of% petitioner's% which%
allegedly%enjoys%goodwill.%
Issue:%
% Atussin,%the%first%with%prefix%"Per"%and%the%second%with%Prefix%"A"%
May% trademark% ATUSSIN% be% registered,% given% the% fact% that%
PERTUSSIN,%another%trademark,%had%been%previously%registered%
in%the%Patent%Office?%
% a% prospective% buyer.% The% trademark% complained% of% should% be%
Held:%
Yes.%
%
That%the%word%"tussin"%figures%as%a%component%of%both%trademarks%
is%nothing%to%wonder%at.%The%Director%of%Patents%aptly%observes%
industries% to% 'fabricate'% marks% by% using% syllables% or% words%
suggestive%of%the%ailments%for%which%they%are%intended%and%adding%
thereto% distinctive% prefixes% or% suffixes".% And% appropriately% to% be%
considered% now% is% the% fact% that,% concededly,% the% "tussin"% (in%
Pertussin% and% Atussin)% was% derived% from% the% Latin% rootZword%
"tussis"%meaning%cough.%
"Tussin"% is% merely% descriptive`% it% is% generic`% it% furnishes% to% the%
buyer% no% indication% of% the% origin% of% the% goods`% it% is% open% for%
appropriation%by%anyone.%It%is%accordingly%barred%from%registration%
as%trademark.%With%jurisprudence%holding%the%line,%we%feel%safe%in%
making%the%statement%that%any%other%conclusion%would%result%in%
"appellant%having%practically%a%monopoly"%of%the%word%"tussin"%in%a%
trademark.%
While%"tussin"%by%itself%cannot%thus%be%used%exclusively%to%identify%
one's%goods,%it%may%properly%become%the%subject%of%a%trademark%
"by%combination%with%another%word%or%phrase".%And%this%union%of%
words% is% reflected% in% petitioner's% Pertussin% and% respondent's%
A%practical%approach%to%the%problem%of%similarity%or%dissimilarity%is%
to%go%into%the%whole%of%the%two%trademarks%pictured%in%their%manner%
of%display.%Inspection%should%be%undertaken%from%the%viewpoint%of%
compared% and% contrasted% with% the% purchaser's% memory% (not% in%
juxtaposition)%of%the%trademark%said%to%be%infringed.%Some%such%
factors%as%"sound`%appearance`%form,%style,%shape,%size%or%format`%
color`% ideas% connoted% by% marks`% the% meaning,% spelling,% and%
%
pronunciation,%of%words%used`%and%the%setting%in%which%the%words%
appear"%may%be%considered.%%For,%indeed,%trademark%infringement%
is%a%form%of%unfair%competition.%

We% concede% the% possibility% that% buyers% might% be% able% to% obtain%
Pertussin% or% Attusin% without% prescription.% When% this% happens,%
then% the% buyer% must% be% one% throughly% familiar% with% what% he%
intends%to%get,%else%he%would%not%have%the%temerity%to%ask%for%a%
medicine%—%specifically%needed%to%cure%a%given%ailment.%In%which%
case,%the%more%improbable%it%will%be%to%palm%off%one%for%the%other.%
For%a%person%who%purchases%with%open%eyes%is%hardly%the%man%to%
be%deceived.%
%
173)%ESSO%STANDARD%EASTERN%v.%CA%and%United% Respondent%United%Cigarette%admitted%that%it%used%the%
Cigarette%Corporation% trademark%Esso%on%its%own%product%of%cigarettes%which%was%not%
Topic:%RemediesZ%Civil%(Sec.%155.1%and%155.2)% identical%to%those%produced%and%sold%by%petitioner%and%therefore,%
% did%not%in%any%way%infringe%on%or%imitate%petitioner’s%trademark.%
FACTS:% %
The%petitioner%Esso%Standard%is%a%foreign%corporation%duly% The%lower%court%found%United%Cigarette%guilty%of%infringement.%%
licensed%to%do%business%in%the%Philippines%"%it%is%engaged%in%the% %
sale%of%petroleum%products%which%are%identified%by%the%trademark% Upon%appeal,%the%Court%of%Appeals%ruled%that%there%was%no%
'Esso'% infringement%in%this%case.%
% %
Esso%Standard%is%a%successor%of%Standard%Vacuum%Oil%Co,%it% ISSUE:%WON%respondent%should%be%held%guilty%of%infringementZ%
registered%as%a%business%name%with%the%Bureau%of%Commerce%in% NO%
1962.%% %
% RULING:%
United%Cigarette%is%a%domestic%corporation%engaged%in%the% ZWhether%trademark%infringement%exists%depends%for%the%most%
manufacture%and%sale%of%cigarettes"%it%acquired%the%business% part%upon%whether%or%not%the%goods%are%so%related%that%the%public%
from%La%Oriental%Tobacco%Corp%including%patent%rights,%once%of% may%be,%or%is%actually,%deceived%and%misled%that%they%came%from%
which%is%the%use%of%'Esso'%on%its%cigarettes% the%same%maker%or%manufacturer%"%Under%the%Related%Goods%
% Theory,%goods%are%related%when%they%belong%to%the%same%class%
The%petitioner%Esso%Standard%filed%a%trademark%infringement% or%have%the%same%descriptive%properties%or%when%they%have%
case%alleging%that%it%had%been%for%many%years%engaged%in%the% same%physical%attributes%
sale%of%petroleum%products%and%its%trademark%ESSO%had% %
acquired%a%considerable%goodwill%to%such%an%extent%that%the% ZFor%nonZcompeting%goods%may%be%those%which,%though%they%are%
buying%public%would%be%deceived%as%the%quality%and%origin%of%the% not%in%actual%competition,%are%so%related%to%each%other%that%it%
said%products%to%the%detriment%and%disadvantage%of%its%own% might%reasonably%be%assumed%that%they%originate%from%one%
products.%% manufacturer%"%NonZcompeting%goods%may%also%be%those%
% which,%being%entirely%unrelated,%could%not%reasonably%be%
Petitioner%Esso%Standard%asserts%that%the%continued%use%by% assumed%to%have%a%common%source%
respondent%United%Cigarette%of%the%same%trademark%ESSO%on%its% %
cigarettes%was%being%carried%out%for%the%purpose%of%deceiving%the% ZIn%the%former%case%of%related%goods,%confusion%of%business%
public%as%to%its%quality%and%origin%to%the%detriment%and% could%arise%out%of%the%use%of%similar%marks`%in%the%latter%case%of%
disadvantage%of%its%own%products.% nonZrelated%goods,%it%could%not%
% %
%
ZIn%the%present%case,%the%goods%are%absolutely%different,%they%are%
so%foreign%to%each%other%as%to%make%it%unlikely%that%purchasers%
would%think%that%petitioner%is%the%manufacturer%of%respondent's%
goods%
%
ZMoreover,%the%goods%flow%from%different%channels%of%trade%and%
are%evidently%different%in%kind%and%nature:%petitioner%Esso’s%
products%are%distributed%principally%through%gasoline%service%and%
automotive%shops%while%respondent’s%products%are%sold%in%sariZ
sari%stores,%vendors%on%the%street,%groceries,%and%other%small%
distributor%outlets%
%
WHEREFORE,%petition%is%DISMISSED.%
Winner:%Respondent%United%Cigarette%
%
Fruit%of%the%Loom%v%CA%
GR.%No.%LZ32747,%29%November%1984,%133%SCRA%405%(1984)%
Ponente:%Makasira,%J.%
% that%respondent's%trademark%FRUIT%FOR%EVE%is%confusingly%
%
DOCTRINE%
There% is% infringement% of% trademark% when% the% use% of% the% mark%
involved%would%be%likely%to%cause%confusion%or%mistake%in%the%mind%
of%the%public%or%to%deceive%purchasers%as%to%the%origin%or%source%
of%the%commodity%%
% •%
% with%the%Bureau%of%Patents%and%it%does%not%bear%the%notice%
FACTS%
•% Petitioner,%a%corporation%duly%organized%and%existing%under%
the%laws%of%the%State%of%Rhode%Island,%United%States%of%
America,%is%the%registrant%of%a%trademark,%FRUIT%OF%THE%
LOOM,%in%the%Philippines%Patent%Office%and%was%issued%two%
Certificates%of%Registration%Nos.%6227%and%6680,%on%
November%29,%1957%and%July%26,%1958,%respectively.%
•% Registration%Nos.%6227:%men’s,%women’s%and%children’s%
underwear%which%includes%women’s%panties%which%falls%under%
class%40%in%the%Philippine%Patent%Office’s%classification%of%
goods.%
•% Registration%Nos.%6680:%knitted,%netted%and%textile%fabrics.%
•% Private%respondent,%a%domestic%corporation,%is%the%registrant%
of%a%trademark%FRUIT%FOR%EVE%in%the%Philippine%Patent%
Office%and%was%issued%a%Certificate%of%Registration%No.%
10160,%on%January%10,%1963%covering%garments%similar%to%
petitioner's%products%like%women's%panties%and%pajamas.%%
•% Petitioner%filed%before%the%lower%court,%a%complaint%for%
infringement%of%trademark%and%unfair%competition%against%the%
respondent.%Petitioner%principally%alleged%in%the%complaint%
similar%to%its%trademark%FRUIT%OF%THE%LOOM%used%also%on%
women's%panties%and%other%textile%products.%%
•% Respondent:%filed%an%answer%invoking%the%special%defense%
that%its%registered%trademark%is%not%confusingly%similar%to%that%
of%petitioner’s.%Likewise,%private%respondent%stated%that%the%
trademark%FRUIT%FOR%EVE%is%being%used%on%ladies'%panties%
and%pajamas%only%whereas%petitioner's%trademark%is%used%
even%on%men's%underwear%and%pajamas.%%
At%the%preZtrial,%the%following%admissions%were%made:%(1)%That%
the%trademark%FRUIT%OF%THE%LOOM%has%been%registered%
'Reg.%Phil.%Patent%Off.',%and%(2)%That%the%trademark%FRUIT%
FOR%EVE%has%been%registered%with%the%Bureau%of%Patents%
and%it%bears%the%notice%"Reg.%Phil.%Patent%Off."%and%(3)%That%
at%the%time%of%its%registration,%plaintiff%filed%no%opposition%
thereto.%%
•% LOWER%COURT:%in%favor%of%petitioner%and%orders%the%
Bureau%of%Patent%to%cancel%the%registration%of%Fruit%for%Eve.%
%
ISSUE%
Whether%or%not%private%respondent's%trademark%FRUIT%FOR%EVE%
and%its%hang%tag%are%confusingly%similar%to%petitioner's%trademark%
FRUIT% OF% THE% LOOM% and% its% hang% tag% so% as% to% constitute% an%
infringement% of% the% latter's% trademark% rights% and% justify% the%
cancellation%of%the%former.%
%
% while%that%of%private%respondent%is%plain%rectangle%without%
any%base.%%
HELD% 2.%The%designs%differ.%Petitioner's%trademark%is%written%in%
There% is% infringement% of% trademark% when% the% use% of% the% mark% almost%semiZcircle%while%that%of%private%respondent%is%
involved%would%be%likely%to%cause%confusion%or%mistake%in%the%mind% written%in%straight%line%in%bigger%letters%than%petitioner's.%
of%the%public%or%to%deceive%purchasers%as%to%the%origin%or%source% Private%respondent's%tag%has%only%an%apple%in%its%center%
of%the%commodity%(Co%Tiong%Sa%vs.%Director%of%Patents,%95%Phil.%1`% but%that%of%petitioner%has%also%clusters%of%grapes%that%
Alhambra%Cigar%&%Cigarette%Co.%vs.%Mojica,%27%Phil.%266`%Sapolin% surround%the%apple%in%the%center.%%
Co.%vs.%Balmaceda,%67%Phil.%705`%La%Insular%vs.%Jao%Oge,%47%Phil.% 3.%The%colors%of%the%hang%tag%are%also%very%distinct%from%
75).%A%visual%presentation%of%the%labels%or%hang%tags%is%the%best% each%other.%Petitioner's%hang%tag%is%fight%brown%while%that%
argument% for% one% or% the% other.% In% determining% whether% the% of%respondent%is%pink%with%a%white%colored%center%piece.%
trademarks%are%confusingly%similar,%a%comparison%of%the%words%is% The%apples%which%are%the%only%similarities%in%the%hang%tag%
not%the%only%determinant%factor.%The%trademarks%in%their%entirety% are%differently%colored.%Petitioner's%apple%is%colored%dark%
as%they%appear%in%their%respective%labels%or%hang%tags%must%also% red,%while%that%of%private%respondent%is%light%red.%%
be%considered%in%relation%to%the%goods%to%which%they%are%attached.%
The% discerning% eye% of% the% observer% must% focus% not% only% on% the% The%similarities%of%the%competing%trademarks%in%this%case%are%
predominant% words% but% also% on% the% other% features% appearing% in% completely%lost%in%the%substantial%differences%in%the%design%and%
both%labels%in%order%that%he%may%draw%his%conclusion%whether%one% general%appearance%of%their%respective%hang%tags.%The%
is%confusingly%similar%to%the%other%(Bristol%Myers%Co.%vs.%Director% trademarks%FRUIT%OF%THE%LOOM%and%FRUIT%FOR%EVE%do%not%
of%Patents,%17%SCRA%131).% resemble%each%other%as%to%confuse%or%deceive%an%ordinary%
purchaser.%%
In%the%trademarks%FRUIT%OF%THE%LOOM%and%FRUIT%FOR%EVE,%
the%lone%similar%word%is%FRUIT.%The%Cout%agrees%with%the% %
respondent%court%that%by%mere%pronouncing%the%two%marks,%it%
could%hardly%be%said%that%it%will%provoke%a%confusion,%as%to%
mistake%one%for%the%other.%Standing%by%itself,%FRUIT%OF%THE%
LOOM%is%wholly%different%from%FRUIT%FOR%EVE.%As%to%the%
design%and%coloring%scheme%of%the%hang%tags,%while%there%are%
similarities%in%the%two%marks%like%the%red%apple%at%the%center%of%
each%mark,%the%court%finds%differences%or%dissimilarities%which%
are%glaring%and%striking%to%the%eye%such%as:%%
1.%The%shape%of%petitioner's%hang%tag%is%round%with%a%base%
that%looks%like%a%paper%rolled%a%few%inches%in%both%ends`%
%
DEL%MONTE%and%PHILIPPINE%PACKING%CORPORATION%VS%
CA%
%
FACTS:%
% •% CA:%affirmed%RTC’s%decision%
•% Petitioner% Del% Monte% Corporation% is% a% foreign% company%
organized% under% the% laws% of% the% United% States% and% not%
engaged%in%business%in%the%Philippines.%%
•% Both%the%Philippines%and%the%United%States%are%signatories%
to%the%Convention%of%Paris,%which%grants%to%the%nationals%of%
the% parties% rights% and% advantages% which% their% own%
nationals%enjoy%for%the%repression%of%acts%of%infringement%
and%unfair%competition.%
•% Petitioner% Philippine% Packing% Corporation% (Philpack)% is% a%
domestic% corporation.% Del% Monte% granted% Philpack% the%
right%to%manufacture,%distribute%and%sell%in%the%Philippines%
various%agricultural%products,%including%catsup,%under%the%
Del%Monte%trademark%and%logo.%
•% Respondent% Sunshine% Sauce% Manufacturing% Industries%
was%issued%a%Certificate%of%Registration%by%the%Bureau%of%
Domestic% Trade% to% engage% in% the% manufacture,% packing,%
distribution%and%sale%of%various%kinds%of%sauce,%identified%
by%the%logo%Sunshine%Fruit%Catsup.%
•% This% logo% was% registered% in% the% Supplemental% Register.%
The%product%itself%was%contained%in%various%kinds%of%bottles,%
including% the% Del% Monte% bottle,% which% the% private%
respondent%bought%from%the%junk%shops%for%recycling.|||%
•% Having% received% reports% that% the% private% respondent% was%
using% its% exclusively% designed% bottles% and% a% logo%
confusingly% similar% to% Del% Monte's,% Philpack% warned% it% to%
desist%from%doing%so%on%pain%of%legal%action.%
•% Philpack% and% Del% Monte% filed% a% complaint% against% the%
private% respondent% for% infringement% of% trademark% and%
unfair%competition%%
•% RTC:%Dismissed%complaint%
%
ISSUE:%
%
WON%Respondent%is%guilty%of%unfair%competition%(YES)%
%
HELD:%
%
According%to%the%SC,%sideZbyZside%comparison%is%not%the%final%
test%of%similarity.%Such%comparison%requires%a%careful%scrutiny%to%
determine%in%what%points%the%labels%of%the%products%differ,%as%was%
done%by%the%trial%judge.%The%ordinary%buyer%does%not%usually%
make%such%scrutiny%nor%does%he%usually%have%the%time%to%do%so.%
The%average%shopper%is%usually%in%a%hurry%and%does%not%inspect%
every%product%on%the%shelf%as%if%he%were%browsing%in%a%library.%
The%question%is%not%whether%the%two%articles%are%distinguishable%
by%their%label%when%set%side%by%side%but%whether%the%general%
confusion%made%by%the%article%upon%the%eye%of%the%casual%
purchaser%who%is%unsuspicious%and%off%his%guard,%is%such%as%to%
likely%result%in%his%confounding%it%with%the%original.%
%
A%number%of%courts%have%held%that%to%determine%whether%a%
trademark%has%been%infringed,%we%must%consider%the%mark%as%a%
whole%and%not%as%dissected.%If%the%buyer%is%deceived,%it%is%
attributable%to%the%marks%as%a%totality,%not%usually%to%any%part%of%
it.%The%court%therefore%should%be%guided%by%its%first%
impression,%for%a%buyer%acts%quickly%and%is%governed%by%a%casual%
glance,%the%value%of%which%may%be%dissipated%as%soon%as%the%
court%assumes%to%analyze%carefully%the%respective%features%of%the%
mark.%
It%has%also%been%held%that%it%is%not%the%function%of%the%court%in%
cases%of%infringement%and%unfair%competition%to%educate%
purchasers%but%rather%to%take%their%carelessness%for%granted,%and%
to%be%ever%conscious%of%the%fact%that%marks%need%not%be%
identical.%A%confusing%similarity%will%justify%the%intervention%of%
equity.%%The%judge%must%also%be%aware%of%the%fact%that%usually%a%
defendant%in%cases%of%infringement%does%not%normally%copy%but%
makes%only%colorable%changes.%Well%has%it%been%said%that%the%
most%successful%form%of%copying%is%to%employ%enough%points%of%
similarity%to%confuse%the%public%with%enough%points%of%difference%
to%confuse%the%courts.%
The%Sunshine%label%is%a%colorable%imitation%of%the%Del%Monte%
trademark.%The%predominant%colors%used%in%the%Del%Monte%label%
are%green%and%redZorange,%the%same%with%Sunshine.%The%word%
“catsup”%in%both%bottles%is%printed%in%white%and%the%style%of%the%
print/letter%is%the%same.%Although%the%logo%of%Sunshine%is%not%a%
tomato,%the%figure%nevertheless%approximates%that%of%a%tomato.%
ISSUE:%
%
WON%Respondent%is%guilty%for%trademark%infringement%(NO)%
%
HELD:%
%
Section%22%of%R.A.%No.%166,%otherwise%known%as%the%Trademark%
Law,%provides:%
%
Any%person%who%shall%use,%without%the%consent%of%the%registrant,%
any%reproduction,%counterfeit,%copy%or%colorable%imitation%of%any%
registered%mark%or%tradename%in%connection%with%the%sale,%offering%
for%sale,%or%advertising%of%any%goods,%business%or%services%on%or%
in%connection%with%which%such%use%is%likely%to%cause%confusion%or%
mistake%or%to%deceive%purchasers%or%others%as%to%the%source%or%
origin%of%such%goods%or%services%or%identity%of%such%business...%
%
Sec.%29%of%the%same%law%states%as%follows:%
%
Any% person% who% shall% employ% deception% or% any% other% means%
contrary% to% good% faith% by% which% he% shall% pass% off% the% goods%
manufactured% by% him% or% in% which% he% deals,% or% his% business,% or%
services%for%those%of%the%one%having%established%such%goodwill...%
%
To%arrive%at%a%proper%resolution%of%this%case,%it%is%important%to%bear%
in% mind% the% following% distinctions% between% infringement% of%
trademark%and%unfair%competition.%
%
% registration% and% withdrawal% of% all% its% products% bearing% the%
(1)% Infringement% of% trademark% is% the% unauthorized% use% of% a%
trademark,%whereas%unfair%competition%is%the%passing%off%of%one's%
goods%as%those%of%another.%
(2)%In%infringement%of%trademark%fraudulent%intent%is%unnecessary%
whereas%in%unfair%competition%fraudulent%intent%is%essential.%
(3)% In% infringement% of% trademark% the% prior% registration% of% the%
trademark% is% a% prerequisite% to% the% action,% whereas% in% unfair%
competition%registration%is%not%necessary.%
% of% the% following% presumptions:% validity% of% the% trademark,% the%
In% determining% whether% two% trademarks% are% confusingly% similar,%
the%two%marks%in%their%entirety%as%they%appear%in%the%respective%
labels%must%be%considered%in%relation%to%the%goods%to%which%they%
are%attached`%the%discerning%eye%of%the%observer%must%focus%not%
only% on% the% predominant% words% but% also% on% the% other% features%
appearing%on%both%labels.%
% the%Principal%Register.%However,%we%find%that%Sunshine,%despite%
We% also% note% that% the% respondent% court% failed% to% take% into%
consideration% several% factors% which% should% have% affected% its%
conclusion,% to% wit:% age,% training% and% education% of% the% usual%
purchaser,%the%nature%and%cost%of%the%article,%whether%the%article%
is% bought% for% immediate% consumption% and% also% the% conditions%
under%which%it%is%usually%purchased.%It%has%been%aptly%observed%
that%the%ultimate%ratio%in%cases%of%grave%doubt%is%the%rule%that%any%
doubt%should%be%resolved%against%the%newcomer%inasmuch%as%the%
field%from%which%he%can%select%a%desirable%trademark%to%indicate%
the%origin%of%his%product%is%obviously%a%large%one.%As%Sunshine's%
label% is% an% infringement% of% the% Del% Monte's% trademark,% law% and%
equity% call% for% the% cancellation% of% the% private% respondent's%
questioned%label%from%the%market.%With%regard%to%the%use%of%Del%
Monte's% bottle,% the% same% constitutes% unfair% competition`% hence,%
the%respondent%should%be%permanently%enjoined%from%the%use%of%
such%bottles.%
%
Sunshine%Sauce%is%not%guilty%of%infringement%for%having%used%the%
Del%Monte%bottle.%The%reason%is%that%the%configuration%of%the%said%
bottle% was% merely% registered% in% the% Supplemental% Register.%
Registration%only%in%the%Supplemental%Register%means%absence%
registrant’s% ownership% of% the% mark% and% his% right% to% its% exclusive%
use.%
%
It%can%be%inferred%from%the%foregoing%that%although%Del%Monte%has%
actual% use% of% the% bottle’s% configuration,% the% petitioners% cannot%
claim%exclusive%use%thereof%because%it%has%not%been%registered%in%
the% many% choices% available% to% it% and% notwithstanding% that% the%
caution% “Del% Monte% Corporation,% Not% to% be% Refilled”% was%
embossed%on%the%bottle,%still%opted%to%use%the%petitioners’%bottle%to%
market% a% product% which% Philpack% also% produces.% This% clearly%
shows% the% private% respondent’s% bad% faith% and% its% intention% to%
capitalize%on%the%latter’s%reputation%and%goodwill%and%pass%off%its%
own%product%as%that%of%Del%Monte.%
%
%
176.%Asia%Brewery,%Inc.%v.%CA% takes% place.%
%
GR%No.%103543,%July%5%1993% In% the% instant% case,% the% dominant% feature% of% SMC% is% the% words%
% “SAN% MIGUEL% PALE% PILSEN”% with% elaborate% serifs% at% the%
beginning%and%end%of%the%letters%"S"%and%"M."%While%the%dominant%
FACTS:% feature%of%ABI's%trademark%is%the%name:%“BEER%PALE%PILSEN”%
% with%the%word%"Beer"%written%in%large%amber%letters.%Besides%the%
San% Miguel% Corporation% (SMC)% filed% a% complaint% against% Asia% dissimilarity% in% their% dominant% feature,% the% following% other%
Brewery% Inc.% (ABI)% for% infringement% of% trademark% and% unfair% dissimilarities% in% the% appearance% of% the% competing% products%
competition% on% account% of% the% latter's% BEER% PALE% PILSEN% or% abound:%
BEER%NA%BEER%product%which%has%been%competing%with%SMC's% %
SAN% MIGUEL% PALE% PILSEN.% San% Miguel%
% Beer% na% Beer%
The% trial% court% dismissed% the% complaint.% Bottle% has% a% slender% tapered% neck%
% Fat,% bulging% neck.%
On%appeal,%the%Court%of%Appeals%reversed%the%decision%of%the%trial% Bottle% cap% is% stamped% with% a% coat% of% arms% and% the% words% "San%
court%and%found%ABI%guilty%of%infringement%of%trademark%and%unfair% Miguel% Brewery% Philippines"% encircling% the% same%
competition.% Stamped%with%the%name%"BEER"%in%the%center,%surrounded%by%the%
% words% "Asia% Brewery% Incorporated% Philippines.”%
% "Bottled% by% the% San% Miguel% Brewery,% Philippines,"%
ISSUE:% "Especially% brewed% and% bottled% by% Asia% Brewery% Incorporated,%
% Philippines."%
Whether% or% not% Asia% Brewery% Inc.% committed% infringement% of% With% SMC% logo%
trademark% and% unfair% competition% against% San% Miguel% No% logo%
Corporation.% Price:% P7.00% per% bottle%
% Price:% P4.25% per% bottle%
HELD:% %
% Based%on%the%dissimilarity%in%their%dominant%features%as%well%as%in%
No% infringement.% Infringement% is% determined% by% the% "test% of% sound,%spelling%&%appearance,%Beer%na%Beer%cannot%be%said%to%be%
dominancy"%rather%than%by%differences%or%variations%in%the%details% similarly% confusing% with% San% Miguel% Pale% Pilsen.%
of%one%trademark%and%of%another.%If%the%competing%trademark%1)% %
contains%the%main%or%essential%or%dominant%features%of%another,% The%fact%that%the%words%pale%pilsen%are%part%of%ABI's%trademark%
and% 2)% confusion% and% deception% is% likely% to% result,% infringement% does% not% constitute% an% infringement% of% SMC's% trademark:% SAN%
%
MIGUEL% PALE% PILSEN,% for% "pale% pilsen"% are% generic% words%
descriptive%of%the%color%("pale"),%of%a%type%of%beer%("pilsen"),%which%
originated% in% the% City% of% Pilsen,% Czechoslovakia.%
%
No%unfair%competition.%%Sec%29,%Republic%Act%No.%166%as%amended%
describes%unfair%competition%as%the%employment%of%deception%or%
any%other%means%contrary%to%good%faith%by%which%a%person%shall%
pass%off%the%goods%manufactured%by%him%or%in%which%he%deals,%or%
his%business,%or%services,%for%those%of%another%who%has%already%
established%goodwill%for%his%similar%goods,%business%or%services,%
or%any%acts%calculated%to%produce%the%same%result.%Therefore,%the%
universal% test% question% is% whether% the% public% is% likely% to% be%
deceived.%
%
In%this%case,%the%use%of%similar%but%unidentical%bottle%size,%shape%
&%color%is%not%unlawful%as%aptly%explained.%The%320%ml%capacity%is%
the%standard%prescribed%by%the%Dept%of%Trade.%The%amber%color%is%
a% functional% feature% for% it% prevents% transmission% of% light% and%
provides%the%maximum%protection%to%beer.%Being%of%functional%or%
common% use,% SMC’s% being% the% first% to% use% does% not% give% SMC%
exclusive% right% to% such% use.% The% bottle% shape% is% usually%
standardized%just%as%a%ketchup%or%vinegar%bottle%with%its%familiar%
elongated%neck,%thereby%dismissing%the%attendance%of%bad%faith%or%
the% intention% to% deceive% the% public% by% ABI.%
%
Moreover,% buyers% generally% order% their% beer% by% brand% in% the%
supermarket,% sariZsari% stores,% restaurants`% thus% dismissing% the%
idea%that%Beer%na%Beer%can%be%passed%off%as%San%Miguel%Beer.%
There%can%be%no%confusion%or%the%likelihood%of%deception%among%
the%consumers.%

%
%
177% Conrad% and% Company,% Inc.% vs.% CA,% Fiterite,% Inc.,% and% •% The% trial% court% ruled% to% dismiss% the% complaint% % on% the%
Victoria%Biscuits,%Co.% ground% of% litis" pendencia,% stating% that% there% is% already% a%
pending%action%before%the%Bureau%of%Patents,%Trademarks,%
TOPIC:%Remedies`%Civil`%Infringement%
and% Technology% Transfer% instituted% by% petitioner’s% USZ
PONENTE:%Vitug,%J:% based%principal%against%respondents’%use%of%the%mark.%%
•% CA% reversed% the% decision,% reinstating% the% complaint% and%
% ordering%petitioner%to%refrain%from%continuing%its%business.%
%
FACTS:%
%
•% Respondents% Fitrite% and% Victoria% Biscuit% Co.,% domestic%
corporations% engaged% in% manufacturing% and% selling% ISSUE(S):%%%
biscuits% and% cookies,% are% the% registered% owners% of% the%
trademark% ‘Sunshine.’% Petitioner% is% also% engaged% in% the% Whether%the%CA%erred%in%reinstating%the%complaint%and%reinstating%
business%of%importing,%selling,%and%distributing%biscuits%and% the%injunctive%relief.%(NO)%
cookies%in%the%Philippines.%
%
•% Fitrite%had%exclusively%used%this%trademark%in%the%concept%
of% owner% since% 1981.% In% 1983,% Fitrite% applied% for% the% RATIO:%
registration% of% its% trademark% in% the% supplemental% register%
and%the%same%was%approved%for%a%term%of%20%yrs.% Litis% Pendencia% cannot% be% applied% in% this% case.% While% an%
application% for% the% administrative% cancellation% of% a% registered%
•% 1984,%Fitrite%authorized%Victoria,%its%sister%company,%to%use%
trademark%is%cognizable%by%the%BPTTT,%actions%for%infringement%
the% trademark.% In% 1990,% Fitrite% assigned% its% trademark% to%
or% unfair% competition,% as% well% as% the% remedy% of% injunction% and%
Victoria% Biscuit.% Sometime% in% the% same% year,% the%
relief% for% damages% are% explicitly% and% unquestionably% within% the%
respondents% discovered% that% petitioner% Conrad% imports%
competence%and%jurisdiction%of%the%ordinary%courts.%
and%sells%‘Sunshine%Biscuits’%in%the%country.%Respondents%
%
then%moved%to%enjoin%petitioner%from%continuing%with%those%
Further,% private% respondents% are% the% holder% of% Certificate% of%
acts%as%it%would%mislead%and%deceive%the%public.%
Registration% No.% 47590% (Principal% Register)% for% the% questioned%
•% Despite% never% having% been% involved% in% the% business% of%
trademark.%This%Court%has%previously%declared%that%registration%in%
importing,% selling,% and% distribution% of% similar% products,%
the%Principal%Register%gives%rise%to%a%presumption%of%validity%of%the%
Conrad%was%suddenly%designated%exclusive%importer%and%
registration% and% of% the% registrant's% ownership% and% right% to% the%
dealer%of%the%products%of%Sunshine%Biscuits,%Inc.%for%sale%in%
exclusive%use%of%the%mark.%It%is%precisely%such%a%registration%that%
the%Philippine%market.%
can%serve%as%the%basis%for%an%action%for%infringement.%An%invasion%
•% This%prompted%Respondents%to%file%and%case%for%“Injunction%
of%this%right%entitles%the%registrant%to%court%protection%and%relief.%
with%Damages%with%Preliminary%Injunction”%against%Conrad.%
%
An%application%with%BPTTT%for%an%administrative%cancellation%of%a%
registered%trade%mark%cannot"per"se"have%the%effect%of%restraining%
or% preventing% the% courts% from% the% exercise% of% their% lawfully%
conferred% jurisdiction.% A% contrary% rule% would% unduly% expand% the%
doctrine% of% primary% jurisdiction% which,% simply% expressed,% would%
merely% behoove% regular% courts,% in% controversies% involving%
specialized% disputes,% to% defer% to% the% findings% of% resolutions% of%
administrative% tribunals% on% certain% technical% matters.% This% rule,%
evidently,% did% not% escape% the% appellate% court% for% it% likewise%
decreed%that%for%"good%cause%shown,%the%lower%court,%in%its%sound%
discretion,% may% suspend% the% action% pending% outcome% of% the%
cancellation% proceedings"% before% BPTTT.% Needless% to% say,% we%
cannot%at%this%stage%delve%into%the%merits%of%the%cancellation%case.%
In% this% instance,% the% sole% concern,% outside% of% the% jurisdictional%
aspect% of% the% petition% hereinbefore% discussed,% would% be% that%
which% focuses% on% the% propriety% of% the% injunction% order% of% the%
appellate% court.%
Wherefore,%petition%is%denied.
%
Title:% Emerald%Garment%Manufacturing%vs.%Court%of%Appeals%
G.R.%No.%100098,%December%29,%1995,%Kapunan,%J.%
% •% Director% of% Patents% granted% private% respondent's% petition%
Doctrine:% An% essential% element% of% infringement% is% colorable%
imitation.% To% determine% whether% there% is% colorable% imitation,%
jurisprudence% provides% two% tests:% the% dominancy% test% and% the%
holistic% test.% In% the% Dominancy% test,% the% essential% or% dominant%
feature% of% another% is% considered% to% determine% whether% there% is%
confusion%and%deception.%For%the%holistic%test,%the%entirety%of%the%
marks%must%be%considered.%
% and%leads%him%to%conclude%that%the%goods%originated%from%
Test%applied%in%this%case:%Holistic%Test%
% feature%of%the%mark.%
Facts:%
•% H.D.% Lee% Co.% Inc.% filed% with% the% Bureau% of% Patents,%
Trademarks%&%Technology%Transfer%(BPTTT)%a%Petition%for%
Cancellation%of%Registration%for%the%trademark%"Stylistic%Mr.%
Lee"%used%on%skirts,%jeans,%blouses,%socks,%briefs,%jackets,%
jogging% suits,% dresses,% shorts,% shirts% and% lingerie% under%
Class% 25,% issued% in% the% name% of% petitioner% Emerald%
Garment%Manufacturing%Corporation.%
•% H.D.% Lee% averred% that% Emerald's% trademark% closely%
resembled% its% own% trademark,% 'LEE'% as% previously%
registered%and%used%in%the%Philippines.%
•% As% a% defense,% Emerald% alleged% that% its% trademark% was%
entirely% and% unmistakably% different% from% that% of% private%
respondent% and% that% its% certificate% of% registration% was%
legally%and%validly%granted.%
•% On%20%February%1984,%Emerald%caused%the%publication%of%
its%application%for%registration%of%the%trademark%"STYLISTIC%
MR.%LEE"%in%the%Principal%Register.%
•% H.D.% Lee% filed% a% notice% of% opposition% to% Emerald's%
application% for% registration% also% on% the% ground% that%
petitioner's%trademark%was%confusingly%similar%to%its%"LEE"%
trademark.%
for% cancellation% and% opposition% to% registration.% He% found%
private% respondent% to% be% the% prior% registrant% of% the%
trademark% "LEE"% in% the% Philippines% and% that% it% had% been%
using% said% mark% in% the% Philippines.% Using% the% test% of%
dominancy,% he% declared% that% petitioner's% trademark% was%
confusingly%similar%to%private%respondent's%mark%because%
"it%is%the%word%'Lee'%which%draws%the%attention%of%the%buyer%
the% same% manufacturer.% % It% is% undeniably% the% dominant%
%
Issue:%Whether%there%is%copyright%infringement.%(No)%
%
Held:%%
•% SEC.%22%of%the%Trademark%Law%provides%what%constitute%
infringement.% The% essential% element% of% infringement% is%
colorable%imitation.%%
•% Colorable%imitation%has%been%defined%as%"such%a%close%or%
ingenious%imitation%as%to%be%calculated%to%deceive%ordinary%
purchasers,%or%such%resemblance%of%the%infringing%mark%to%
the% original% as% to% deceive% an% ordinary% purchaser% giving%
such%attention%as%a%purchaser%usually%gives,%and%to%cause%
him%to%purchase%the%one%supposing%it%to%be%the%other.%
•% To% determine% whether% there% is% colorable% imitation%
jurisprudence%provides%two%testsZthe%Dominancy%Test%and%
the%Holistic%Test:%
1.% Dominancy% Test% provides% that% if% the% competing%
trademark% contains% the% main% or% essential% or%
dominant% features% of% another,% and% confusion% and%
deception% is% likely% to% result,% infringement% takes%
%
place.%%Duplication%or%imitation%is%not%necessary`%nor%
it% is% necessary% that% the% infringing% label% should%
suggest%an%effort%to%imitate.%
2.% Holistic%Test%mandates%that%the%entirety%of%the%marks%
in% question% must% be% considered% in% determining%
confusing% similarity.% In% determining% whether% the%
trademarks%are%confusingly%similar,%a%comparison%of%
the% words% is% not% the% only% determinant% factor.% The%
trademarks%in%their%entirety%as%they%appear%in%their%
respective% labels% or% hang% tags% must% also% be%
considered%in%relation%to%the%goods%to%which%they%are%
attached.%%The%discerning%eye%of%the%observer%must%
focus%not%only%on%the%predominant%words%but%also%
on% the% other% features% appearing% in% both% labels% in%
order%that%he%may%draw%his%conclusion%whether%one%
is%confusingly%similar%to%the%other.%
•% Applying% such% in% this% case,% Stylistic% Mr.% Lee% is% not%
confusingly% similar% to% private% respondent's% "Lee"%
trademark.% Petitioner's% trademark% is% the% whole% "Stylistic%
Mr.%Lee."%Although%on%its%label%the%word%"Lee"%is%prominent,%
the%trademark%should%be%considered%as%a%whole%and%not%
piecemeal.% % The% dissimilarities% between% the% two% marks%
become%conspicuous,%noticeable%and%substantial%enough%
to%matter%especially%in%the%light%of%the%following%variables%
that%must%be%factored%in:%
1.% The%products%involved%in%the%case%at%bar%are%various%
kinds%of%jeans.%%The%casual%buyer%is%predisposed%to%
be%more%cautious%and%discriminating%in%and%would%
prefer% to% mull% over% his% purchase.% Confusion% and%
deception,% then,% is% less% likely.% Accordingly,% what%
essentially% determines% the% attitudes% of% the%
purchaser,%specifically%his%inclination%to%be%cautious,%
is% the% cost% of% the% goods.% As% a% general% rule,% an%
ordinary% buyer% does% not% exercise% as% much%
prudence%in%buying%an%article%for%which%he%pays%a%
few% centavos% as% he% does% in% purchasing% a% more%
valuable%thing.%%Expensive%and%valuable%items%are%
normally%bought%only%after%deliberate,%comparative%
and% analytical% investigation.% % But% mass% products,%
low% priced% articles% in% wide% use,% and% matters% of%
everyday%purchase%requiring%frequent%replacement%
are% bought% by% the% casual% consumer% without% great%
care.%The%court%held%that%maong%pants%or%jeans%are%
not%inexpensive.%
2.% Second% the% average% Filipino% consumer% generally%
buys%his%jeans%by%brand.%
•% Moreover,%private%respondent%failed%to%prove%prior%actual%
commercial%use%of%its%"LEE"%trademark%in%the%Philippines%
before%filing%its%application%for%registration%with%the%BPTTT%
and% hence,% has% not% acquired% ownership% over% said% mark.%
Actual%use%in%commerce%in%the%Philippines%is%an%essential%
prerequisite% for% the% acquisition% of% ownership% over% a%
trademark% pursuant% to% Sec.% 2% and% 2ZA% of% the% Philippine%
Trademark%Law%(R.A.%No.%166).%For%lack%of%adequate%proof%
of% actual% use% of% its% trademark% in% the% Philippines% prior% to%
petitioner's%use%of%its%own%mark%and%for%failure%to%establish%
confusing% similarity% between% said% trademarks,% private%
respondent's%action%for%infringement%must%necessarily%fail.%
%
%
WHEREFORE,% premises% considered,% the% questioned%
decision%and%resolution%are%hereby%REVERSED%and%SET%ASIDE.%
%
179%Amigo%Manufacturing,%Inc.%vs.%Cluett%Peabody%Co.,%Inc.%
TOPIC:%Remedies`%Civil`%Infringement%
PONENTE:%Panganiban,%J:%
% registered%in%the%Philippines%of%tradename%previously%used%
FACTS:%
•% Respondent% Cluett% filed% an% action% with% the% Patent% Office%
against%Petitioner%Amigo%for%the%cancellation%of%the%latter’s%
trademark,%claiming%exclusive%ownership%over%the%same%as%
successorZinZinterest%of%Great%American%Knitting%Mills,%Inc.%
•% The%Respondents%presented%4%Certificates%of%Registration.%
The%trademark%was%essentially%a%plurality%parallel%golden%
lines% arranged% in% a% triangular% area% at% the% toe% of% men’s%
socks.%
•% The%certificates%were%for:%Gold%Toe%(dated%Sept.%22,%1958),%
Device,%a%sock%and%a%magnifying%glass%on%the%toe%(dated%
Jan.%25,%1968),%Device,%a%plurality%of%gold%colored%parallel%
lines% in% a% triangular% area% at% the% toe% (dated% May% 9,% 1968,%
and%Linenized%(dated%April%13,%1970).%
•% Petitioner’s% trademark% and% device% was% “Gold% Top,%
Linenized%for%Extra%Wear.”%It%had%a%dominant%white%color%at%
the% center% and% a% blackish% brown% background% with% a%
magnified%design%of%the%sock%garters,%and%is%labeled%Amigo%
Manufacturing%Inc.,%Mandaluyong,%Metro%Manila,%Made%in%
the%Philippines.%
•% In% the% Patent% Office,% the% case% was% heard% by% 6% Hearing%
Officers,% who% rendered% a% decision% against% Petitioner%
Amigo.%
•% The%CA%initially%rendered%a%decision%in%favor%of%Petitioner,%
but%found%for%Respondent%on%reconsideration.%
•% The% CA% ruled% that% there% was% hardly% any% variance% in% the%
appearance%of%the%marks%since%both%show%a%representation%
of%a%man’s%foot%wearing%a%sock,%and%the%marks%are%printed%
in% identical% lettering.% Sec.% 4(d)% of% R.A.% No.% 166% declares%
unregistrable%a%mark%which%consists%or%comprises%a%mark%
or% trademark% which% so% resembles% a% mark% or% tradename%
in%the%Philippines%by%another%and%not%abandoned,%as%to%be%
likely,% when% applied% to% or% used% in% connection% with% the%
goods,% business% or% services% of% the% applicant,% to% cause%
confusion%or%mistake%or%to%deceive%the%purchasers.%In%this%
case,%the%Petitioner’s%trademark%was%a%combination%of%the%
different%registered%marks%owned%by%Respondent.%
•% The%CA%further%ruled%that%question%is%not%whether%the%two%
articles% are% distinguishable% by% their% label% when% set% aside%
but% whether% the% general% confusion% made% by% the% article%
upon%the%eye%of%the%casual%purchaser%who%is%unsuspicious%
and%off%his%guard,%is%such%as%to%likely%result%in%confounding%
it%with%the%original.%It%also%held%that%Petitioner’s%mark%is%only%
registered%with%the%Supplemental%Registry%which%gives%no%
right% of% exclusivity% to% the% owner% and% cannot% overturn% the%
presumption%of%validity%and%exclusivity%given%to%a%registered%
mark.% The% CA% also% used% the% Paris% Convention% which%
protects%Respondent’s%mark.%
•% The%Petitioner%now%appeals%to%the%SC,%claiming%that%it%was%
in%use%of%the%mark%earlier%than%Respondent%and%that%there%
were% no% confusing% similarities.% They% also% assailed% the%
applicability%of%the%Paris%Convention.%
%
ISSUE(S):%%%
1.% Whether%the%Petitioner%was%in%actual%use%of%the%trademark%
earlier%than%Respondent.%
2.% Whether%there%are%confusing%similarities.%
%
3.% Whether%the%Paris%Convention%applies.%
HELD:%%
1.% NO%
2.% YES%
3.% YES%
% in% applying% idem% sonans.% However,% the% director% did% not%
RATIO:%
1.% Petitioner%claims%it%started%actual%use%in%September%1956%
while%Respondent%began%using%the%mark%only%on%May%15,%
1962.% However,% these% claims% are% unsubstantiated.%
Further,% the% witnesses% presented% by% the% Petitioner% all%
gave% contradicting% testimonies% as% to% the% date% of% actual%
use,%with%different%dates%such%as%1952,%1947,%and%1938.%
Based% on% the% evidence,% the% Respondents% have% shown%
use% of% the% mark% prior% to% the% Petitioners.%
% representation%of%a%man’s%foot%wearing%a%sock%and%based%
The% registration% of% the% Respondent’s% marks% constitutes%
prima%facie%evidence%of%Respondent’s%ownership%of%those%
marks,% which% Petitioner% has% failed% to% overturn.% Further,%
Petitioner%neither%questioned%the%validity%of%the%certificates%
nor% did% they% present% evidence% to% indicate% that% the% same%
were%fraudulently%issued.%%Section%5ZA%of%Republic%Act%No.%
166%states%that%an%applicant%for%a%trademark%or%trade%name%
shall,%among%others,%state%the%date%of%first%use.%The%fact%
that% the% marks% were% indeed% registered% by% respondent%
shows% that% it% did% use% them% on% the% date% indicated% in% the%
Certificate% of% Registration.% On% the% other% hand,% petitioner%
failed%to%present%proof%of%the%date%of%alleged%first%use%of%
the% trademark% Gold% Top% and% Device.% Thus,% even%
assuming%that%respondent%started%using%it%only%on%May%15,%
1962,%we%can%make%no%finding%that%petitioner%had%started%
using%it%ahead%of%respondent.%
Further,%Petitioner%registered%its%trademark%only%with%the%
supplemental% register.% In% Le% Chemise% Lacoste% v.%
Fernandez,%the%Court%held%that%such%registration%gives%no%
presumption%of%ownership%of%the%trademark.%
2.% The%Petitioner%points%out%that%the%director%of%patents%erred%
rely% on% the% idem% sonans% test% alone% on% arriving% at% its%
conclusion.% As% earlier% stated,% Petitioner’s% mark% is% a%
combination% of% the% marks% of% Respondent.% Further,% Gold%
Top% &% Device% is% confusingly% similar% with% Gold% Toe.% The%
difference%in%sound%only%occurs%in%the%final%letter%at%the%end%
of% the% marks.% There% is% also% hardly% any% variance% in% their%
appearance.%
The%Bureau%considered%the%drawings%and%the%labels,%the%
appearance% of% the% labels,% the% lettering,% and% the%
its%conclusion%on%the%totality%of%the%similarities%between%the%
parties’%trademarks%and%not%on%their%sounds%alone.%
In%determining%whether%there%is%colourable%imitation,%the%
Court%developed%two%kinds%of%tests:%the%Dominancy%Test%
and%the%Holistic%test.%The%former%focuses%on%the%similarity%
of% the% prevalent% features% of% the% competing% trademarks%
which% might% cause% confusion% or% deception% and% thus%
constitutes% infringement,% while% the% latter% considers% the%
entirety%of%the%marks%in%question%in%determining%confusing%
similarity.%
In% applying% the% dominancy% test,% while% it% is% admitted% that%
there% are% differences% between% the% two% marks,% the%
similarities%are%of%such%degree,%number,%and%quality%that%
the% overall% impression% is% that% the% two% brands% are%
deceptively%similar%to%each%other.%The%dominant%features%
%
are% gold% checkered% lines% against% a% predominantly% black%
background% and% a% representation% of% a% sock% with% a%
magnifying%glass,%with%both%products%using%the%same%type%
of%lettering.%Also,%the%names%of%the%brands%are%similar,%and%
are%in%the%same%line%of%business.%
A%foreignZbased%trademark%owner,%whose%country%of%domicile%is%a%
party% to% an% international% convention% relating% to% protection% of%
trademarks,% is% accorded% protection% against% infringement% or% any%
unfair%competition%as%provided%in%Section%37%of%Republic%Act%166,%
the% Trademark% Law% which% was% the% law% in% force% at% the% time% this%
case%was%instituted.
%
SOCIETE%DES%PRODUCTS%NESTLE%v.%CA%
GR%No.%112012%–%April%4,%2001%–%YnaresZSantiago%
%
TOPIC:% Is% there% infringement% even% if% the% goods% are% nonZ
competing?%%
%
FACTS:%
On%January%18,%1984,%CFC%Corporation%(private%respondent)%filed%
with%the%BPTT%an%application%for%the%registration%of%the%trademark%
“FLAVOR% MASTER”% for% instant% coffee.% The% application% was%
published%in%July%18,%1988%issue%of%the%BPTT’s%Official%Gazette.%%
%
Societe% Des% Produits% Nestle% (petitioner)% a% Swiss% company%
registered%under%Swiss%laws%and%domiciled%in%Switzerland,%filed%
an%unverified%Notice%of%Opposition,%claiming%that%the%TM%of%private%
respondent’s%product%is%“confusingly%similar%to%its%TMs%for%coffee%
and% coffee% extracts,% to% wit:% MASTER% ROAST% and% MASTER%
BLEND.%%
% CA:%Ruled%in%favor%of%CFC%(private%respondnet).Reversed%BPTT’s%
Likewise,% Nestle% Philippines,% Inc.,% a% PH% corporation% and% a%
licensee%of%petitioner,%filed%a%verified%Notice%of%Opposition%against%
CFC’s%application%for%registration%claiming%that%the%use,%if%any,%by%
CFC%of%the%TM%FLAVOR%MASTER%and%its%registration%would%likely%
cause%confusion%in%the%trade`%or%deceive%purchasers%and%would%
falsely% suggest% to% the% purchasing% public% a% connection% in% the%
business%of%Nestle,%as%the%dominant%word%present%in%the%3%TMs%is%
“MASTER”`% or% that% the% goods% of% CFC% might% be% mistaken% as%
having%originated%from%the%latter.%%
%
CFC%argued%that:%
1.% Its% trademark,% FLAVOR% MASTER,% is% not% confusingly%
similar% with% the% trademarks,% MASTER% ROAST% and%
MASTER% BLEND,% alleging% that,% “except% for% the% word%
MASTER% (which% cannot% be% exclusively% appropriated% by%
any%person%for%being%a%descriptive%or%generic%name),%the%
other% words% that% are% used% respectively% with% said% word% in%
the%three%trademarks%are%very%different%from%each%other—
in%meaning,%spelling,%pronunciation,%and%sound.”%%
2.% Its%trademark,%FLAVOR%MASTER,%“is%clearly%very%different%
from% any% of% Nestlé’s% trademarks% MASTER% ROAST% and%
MASTER%BLEND,%especially%when%the%marks%are%viewed%
in% their% entirety,% by% considering% their% pictorial%
representations,% color% schemes% and% the% letters% of% their%
respective%labels.”%%
Bureau% of% Patents,% Trademarks% and% Technology% Transfer%
(BPTT):% ruled% in% favor% of% Nestle% (petitioner).% denied% CFC’s%
application%for%registration.%%
decision.%%
%
ISSUE:% WON% the% trademark% FLAVOR% MASTER% is% a% colorable%
imitation% of% the% trademarks% MATER% ROAST% and% MASTER%
BLEND.%%
%
%
HELD:%Yes.%The%CA%decision%is%reversed%and%the%BPTT%decision%
is%reinstated.%%
%A% trademark% has% been% generally% defined% as% “any% word,% name,%
symbol% or% device% adopted% and% used% by% a% manufacturer% or%
merchant%to%identify%his%goods%and%distinguish%them%from%those%
manufactures%and%sold%by%others.”%
Colorable% imitation% denotes% such% a% close% or% ingenious% imitation%
as% to% be% calculated% to% deceive% ordinary% persons,% or% such% a%
resemblance%to%the%original%as%to%deceive%an%ordinary%purchaser%
giving%such%attention%as%a%purchaser%usually%gives,%as%to%cause
%
him%to%purchase%the%one%supposing%it%to%be%the%other.%%
% According%to%the%SC,%if%the%ordinary%purchaser%is%“undiscerningly%
In% determining% if% colorable% imitation% exists,% jurisprudence% has%
developed% two%% kinds% of% tests—the% Dominancy% Test% and% the%
Holistic%Test. The%test%of%dominancy%focuses%on%the%similarity%of%
the%prevalent%features%of%the%competing%trademarks%which%might%
cause% confusion% or% deception% and% thus% constitute% infringement.%
On%the%other%side%of%the%spectrum,%the%holistic%test%mandates%that%
the% entirety% of% the% marks% in% question% must% be% considered% in%
determining%confusing%similarity.%%
% similarities% or% dissimilarities,% considering% that% the% product% is% an%
In% infringement% or% trademark% cases% in% the% PH,% particularly%
ascertaining%whether%one%trademark%is%confusingly%similar%to%or%is%
a%colorable%imitation%of%another,%no%set%of%rules%can%be%deduced.%
Each%case%must%be%decided%on%its%own%merits.%The%likelihood%of%
confusion%is%a%relative%concept%to%be%determined%only%according%
to%the%particular,%and%sometimes%peculiar,%circumstances%of%each%
case.%%
% in%the%realities%of%the%marketplace. The%totality%or%holistic%test%only%
Whether%dominancy%test%or%the%holistic%test%should%be%
applied%
The%SC%ruled%that%CA’s%application%of%the%totality%or%holistic%test%is%
misplaced.% CA% held% that% the% test% to% be% applied% should% be% the%
totality% or% holistic% test% reasoning,% since% what% is% of% paramount%
consideration% is% the% ordinary% purchaser% who% is,% in% general,%
undiscerningly% rash% in% buying% the% more% common% and% less%
expensive%household%products%like%coffee,%and%is%therefore%less%
inclined% to% closely% examine% specific% details% of% similarities% and%
dissimilarities%between%competing%products.%%
%
rash”% in% buying% such% common% and% inexpensive% household%
products%as%instant%coffee,%and%would%therefore%be%“less%inclined%
to% closely% examine% specific% details% of% similarities% and%
dissimilarities”%between%the%two%competing%products,%then%it%would%
be% less% likely% for% the% ordinary% purchaser% to% notice% that% CFC’s%
trademark% FLAVOR% MASTER% carries% the% colors% orange% and%
mocha%while%that%of%Nestlé’s%uses%red%and%brown.%The%application%
of% the% totality% or% holistic% test% is% improper% since% the% ordinary%
purchaser% would% not% be% inclined% to% notice% the% specific% features,%
inexpensive%and%common%household%item.%%
%
Moreover,%the%totality%or%holistic%test%is%contrary%to%the%elementary%
postulate% of% the% law% on% trademarks% and% unfair% competition% that%
confusing% similarity% is% to% be% determined% on% the% basis% of% visual,%
aural,% connotative% comparisons% and% overall% impressions%
engendered%by%the%marks%in%controversy%as%they%are%encountered%
%
% %
relies%on%visual%comparison%between%two%trademarks%whereas%the%
dominancy%test%relies%not%only%on%the%visual%but%also%on%the%aural%
and% connotative% comparisons% and% overall% impressions% between%
the%two%trademarks.%%
%
For%this%reason,%this%Court%agrees%with%the%BPTTT%when%it%applied%
the%test%of%dominancy.%%
%
Applying%the%dominancy%test%
The% word% MASTER% is% the% dominant% feature% of% opposer’s% mark.%
The%word%MASTER%has%always%been%given%emphasis%in%the%TV%
and% radio% commercials% and% other% advertisements% made% in%
promoting%the%product%of%Nestle.%%
% protection% in% the% absence% of% secondary% meaning.% While%
In% addition,% the% word% MASTER% is% neither% a% generic% nor% a%
descriptive%term.%As%such,%said%term%can%not%be%invalidated%as%a%
TM%and,%therefore,%may%be%legally%protected.%%
% This%is%evident%from%the%advertising%scheme%adopted%by%Nestle%in%
Generic% terms% are% those% which% constitute% “the% common%
descriptive% name% of% an% article% or% substance,”% or% comprise% the%
“genus% of% which% the% particular% product% is% a% species,”% or% are%
“commonly%used%as%the%name%or%description%of%wa%kind%of%goods,”%
or%“imply%reference%to%every%member%of%a%genus%and%the%exclusion%
of% individuating% characters,”% or% “refer% to% the% basic% nature% of% the%
wares%or%services%provided%rather%than%to%the%more%idiosyncratic%
characteristics% of% a% particular% product,”% and% are% not% legally%
protectable.%%
On%the%other%hand,%a%term%is%descriptive and%therefore%invalid%as%
a%trademark%if,%as%understood%in%its%normal%and%natural%sense,%it%
“forthwith% conveys% the% characteristics,% functions,% qualities% or%
ingredients%of%a%product%to%one%who%has%never%seen%it%and%does%
not%know%what%it%is,”%or%“if%it%forthwith%conveys%an%immediate%idea%
of%the%ingredients,%qualities%or%characteristics%of%the%goods,”%or%if%
it%clearly%denotes%what%goods%or%services%are%provided%in%such%a%
way% that% the% consumer% does% not% have% to% exercise% powers% of%
perception%or%imagination.%%
Rather,%the%term%MASTER%is%a%suggestive%term%brought%about%by%
the%advertising%scheme%of%Nestle.%%
Suggestive% terms% are% those% which,% in% the% phraseology% of% one%
court,% require% imagination,% thought% and% perception% to% reach% a%
conclusion% as% to% the% nature% of% the% goods.”% Such% terms,% “which%
subtly% connote% something% about% the% product,”% are% eligible% for%
suggestive% marks% are% capable% of% shedding% “some% light”% upon%
certain% characteristics% of% the% goods% or% services% in% dispute,% they%
nevertheless% involve% “an% element% of% incongruity,’’%
“figurativeness,”%or%“imaginative%effort%on%the%part%of%the%observer.”%%
promoting% its% coffee% products.% Where% Nestle% promoted% its%
products% as% “coffee% perfection% worthy% of% masters% like% Robert%
Jaworski%and%Ric%Puno,%Jr.”%
Thus,%the%term%“MASTER,”%has%acquired%a%certain%connotation%to%
mean% the% coffee% products% MASTER% ROAST% and% MASTER%
BLEND%produced%by%Nestle.%As%such,%the%use%by%CFC%of%the%term%
“MASTER”% in% the% trademark% for% its% coffee% product% FLAVOR%
MASTER% is% likely% to% cause% confusion% or% mistake% or% even% to%
deceive%the%ordinary%purchasers.%%
%
G.R.%No.%111580.%June%21,%2001.%
SHANGRI>LA%INTERNATIONAL%HOTEL%MANAGEMENT%LTD,%
SHANGRI>LA% PROPERTIES,% INC.,% MAKATI% SHANGRI>LA%
HOTEL% AND% RESORT,% INC.% And% KUOK% PHILIPPINE%
PROPERTIES,% INC,% petitioners,% vs.% THE% COURT% OF%
APPEALS,% HON.% FELIX% M.% DE% GUZMAN,% as% Judge,% RTC% of%
Quezon% City,% Branch% 99% and% DEVELOPERS% GROUP% OF%
COMPANIES,%INC,%respondents.%
% %
G.R.%No.%114802.%June%21,%2001.*%
DEVELOPERS% GROUP% OF% COMPANIES,% INC,% petitioner,% vs.%
THE%COURT%OF%APPEALS,%HON.%IGNACIO%S.%SAPALO,%in%his%
capacity% as% Director,% Bureau% of% Patents,Trademarks% and%
Technology% Transfer,% and% SHANGRIZLA% INTERNATIONAL%
HOTEL%MANAGEMENT,%LTD,%respondents.%
% on% the% ground% that% the% same% was% illegally% and% fraudulently%
DOCTRINE:%%
•%The%earlier%institution%of%an%Inter%Partes%case%for%the%cancellation%
of%a%registered%service%mark%and%device/logo%with%the%Bureau%of%
Patents,%Trademarks%and%Technology%Transfer%(BPTTT)%cannot%
effectively%bar%the%subsequent%filing%of%an%infringement%case%by%
the%registrant.%
•%In% the% same% light% that% the% infringement% case% can% and% should%
proceed% independently% from% the% cancellation% case% with% the%
Bureau%so%as%to%afford%the%owner%of%certificates%of%registration%
redress% and% injunctive% reliefs,% so% must% the% cancellation% case%
with% the% BPTTT% (now% the% Bureau% of% Legal% Affairs,% Intellectual%
Property%Office)%continue%independently%from%the%infringement%
case% so% as% to% determine% whether% a% registered% mark% may%
ultimately%be%cancelled.%
•%With% the% decision% of% the% Regional% Trial% Court% upholding% the%
validity%of%the%registration%of%the%service%mark%“ShangriZLa”%and%
“S”%logo%in%the%name%of%Developers%Group,%the%cancellation%case%
filed%with%the%Bureau%becomes%moot.%
•%To%provide%a%judicious%resolution%of%the%issues,%the%Court%finds%
it% apropos% to% order% the% suspension% of% the% proceedings% before%
the% Bureau% pending% final% determination% of% the% infringement%
case,% where% the% issue% of% the% validity% of% the% registration% of% the%
subject%trademark%and%logo%in%the%name%of%Developers%Group%
was%passed%upon%
FACTS:%%
•%On% June% 21,% 1988,% the% ShangriZLa% International% Hotel%
Management%filed%with%the%Bureau%of%Patents,%Trademarks%and%
Technology% Transfer% (BPTTT)% a% petition% praying% for% the%
cancellation%of%the%registration%of%the%"ShangriZLa"%mark%and%"S"%
device/logo%issued%to%the%Developers%Group%of%Companies,%Inc.,%
obtained%and%appropriated%for%the%latter's%restaurant%business.%%
•%The%ShangriZLa%Group%alleged%that%it%is%the%legal%and%beneficial%
owners%of%the%subject%mark%and%logo`%that%it%has%been%using%the%
said%mark%and%logo%for%its%corporate%affairs%and%business%since%
March%1962%and%caused%the%same%to%be%specially%designed%for%
their%international%hotels%in%1975,%much%earlier%than%the%alleged%
first%use%thereof%by%the%Developers%Group%in%1982.%
•%It%also%filed%with%the%BPTTT%its%own%application%for%registration%
of% the% subject% mark% and% logo.% The% Developers% Group% filed% an%
opposition% to% the% application,% which% was% docketed% as% Inter%
Partes% Case% No.% 3529.% Almost% 3% years% later,% or% on% April% 15,%
1991,%the%Developers%Group%instituted%with%the%RTC%of%Quezon%
City%a%complaint%for%infringement%and%damages%with%prayer%for%
injunction.%%
•%On% January% 8,% 1992,% the% ShangriZLa% Group% moved% for% the%
suspension% of% the% proceedings% in% the% infringement% case% on%
account% of% the% pendency% of% the% administrative% proceedings%
%
before% the% BPTTT.% This% was% denied% by% the% trial% court% in% a%
Resolution%issued%on%January%16,%1992.%%
% the%registered%mark%with%the%proper%court%or%Bureau%
ISSUE:%%%
Whether,% despite% the% institution% of% an% Inter% Partes% case% for%
cancellation%of%a%mark%with%the%BPTTT%(now%the%Bureau%of%Legal%
Affairs,% Intellectual% Property% Office)% by% one% party,% the% adverse%
party% can% file% a% subsequent% action% for% infringement% with% the%
regular%courts%of%justice%in%connection%with%the%same%registered%
mark.%
% be%decided.%(Emphasis%provided)%
RULING:%%
Section%151.2%of%Republic%Act%No.%8293,%otherwise%known%as%the%
Intellectual%Property%Code,%provides,%as%follows%–%
Section% 151.2.% Notwithstanding% the% foregoing%
provisions,% the% court% or% the% administrative% agency%
vested% with% jurisdiction% to% hear% and% adjudicate% any%
action%to%enforce%the%rights%to%a%registered%mark%shall%
likewise% exercise% jurisdiction% to% determine% whether%
the% registration% of% said% mark% may% be% cancelled% in%
accordance%with%this%Act.%The%filing%of%a%suit%to%enforce%
the%registered%mark%with%the%proper%court%or%agency%
shall% exclude% any% other% court% or% agency% from%
assuming% jurisdiction% over% a% subsequently% filed%
petition%to%cancel%the%same%mark.%On%the%other%hand,%
the%earlier%filing%of%petition%to%cancel%the%mark%with%
the%Bureau%of%Legal%Affairs%shall%not%constitute%a%
prejudicial%question%that%must%be%resolved%before%
an%action%to%enforce%the%rights%to%same%registered%
mark%may%be%decided.%(Emphasis%provided)%
% person%who%infringes%upon%the%former's%rights.%
Similarly,% Rule% 8,% Section% 7,% of% the% Regulations% on% Inter% Partes%
Proceedings,%provides%to%wit%–%
Section%7.%Effect%of%filing%of%a%suit%before%the%Bureau%
or%with%the%proper%court.%Z%The%filing%of%a%suit%to%enforce%
shall% exclude% any% other% court% or% agency% from%
assuming% jurisdiction% over% a% subsequently% filed%
petition%to%cancel%the%same%mark.%On%the%other%hand,%
the%earlier%filing%of%petition%to%cancel%the%mark%with%
the% Bureau% shall% not% constitute% a% prejudicial%
question%that%must%be%resolved%before%an%action%
to%enforce%the%rights%to%same%registered%mark%may%
%
Hence,%as%applied%in%the%case%at%bar,%the%earlier%institution%of%an%
Inter%Partes%case%by%the%ShangriZLa%Group%for%the%cancellation%of%
the% "ShangriZLa"% mark% and% "S"% device/logo% with% the% BPTTT%
cannot% effectively% bar% the% subsequent% filing% of% an%
infringement%case%by%registrant%Developers%Group.%The%law%and%
the%rules%are%explicit.%
%
The%rationale%is%plain:%Certificate%of%Registration%No.%31904,%upon%
which% the% infringement% case% is% based,% remains% valid% and%
subsisting%for%as%long%as%it%has%not%been%cancelled%by%the%Bureau%
or% by% an% infringement% court.% As% such,% Developers% Group's%
Certificate% of% Registration% in% the% principal% register% continues% as%
"prima% facie% evidence% of% the% validity% of% the% registration,% the%
registrant's% ownership% of% the% mark% or% tradeZname,% and% of% the%
registrant's%exclusive%right%to%use%the%same%in%connection%with%the%
goods,%business%or%services%specified%in%the%certificate."%Since%the%
certificate% still% subsists,% Developers% Group% may% thus% file% a%
corresponding%infringement%suit%and%recover%damages%from%any%
%
DISPOSITIVE%PORTION:%
%
WHEREFORE,% 11% view% of% the% foregoing,% judgment% is%
hereby%rendered%dismissing%G.R.%No.%111580%for%being%moot%and%
academic,%and%ordering%the%Bureau%of%Legal%Affairs,%Intellectual%
Property% Office,% to% suspend% further% proceedings% in% Inter% Partes%
Case%No.%3145,%to%await%the%final%outcome%of%the%appeal%in%Civil%
Case%No.%QZ91Z8476.%
SO%ORDERED.%
%
MIGHTY% CORPORATION% and% LA% CAMPANA% FABRICA% DE%
TABACO,% INC.,% vs.% E.% &% J.% GALLO% WINERY% and% THE%
ANDRESONS%GROUP,%INC.%
%
FACTS:%
% •% In%May%1984,%Tobacco%Industries%assigned%the%GALLO%
Respondents:%
Gallo% Winery% –% foreign% corporation% not% doing% business% in% the%
Philippines% but% organized% and% existing% under% the% laws% of%
California,%U.S.,%where%all%its%wineries%are%located.%They%produce%
different% kinds% of% wines% and% brandy% products% and% sells% them% in%
many%countries%under%different%registered%trademarks,%including%
the%GALLO"and"ERNEST"&"JULIO"GALLO%wine%trademarks.%The%
GALLO%trademark%was%registered%in%the%Philippines%in%1971%and%
renewed%in%1991%for%another%20%years%
%
Andersons% –% domestic% corporation.% Has% been% Gallo% Winery’s%
exclusive%wine%importer%and%distributor%since%1991.%They%sell%the%
products%in%its%own%name%and%for%its%own%account.%%
% expanded%their%Philippine%market%through%authorized%
Petitioners:%
Mighty% Corporation% and% La% Campana% (tobacco% industries)–%
sister% companies.% They% are% engaged% in% the% cultivation,%
manufacture,%distribution%and%sale%of%tobacco%products%for%which%
they%have%been%using%the%GALLO%cigarette%trademark%since%1973%
%
•% BIR%approved%the%Tobacco%Industries%use%of%GALLO%
100s%cigarette%mark%on%September%14,%1973%and%GALLO%
filter%cigarette%mark%on%March%26,%1976,%both%for%the%
manufacture%and%sale%of%its%cigarette%products.%
•% On%February%5,%1974,%Tobacco%Industries%applied%for,%but%
eventually%did%not%pursue,%the%registration%of%the%GALLO%
cigarette%trademark%%
cigarette%trademark%to%La%Campana%%
•% On%July%17,%1985,%the%National%Library%issued%Certificate%
of%Copyright%Registration%No.%5834%for%La%Campanas%
lifetime%copyright%claim%over%GALLO%cigarette%labels%
•% La%Campana%authorized%Mighty"Corporation%to%
manufacture%and%sell%cigarettes%bearing%the%GALLO%
trademark.%
•% BIR%approved%Mighty%Corporations%use%of%GALLO%100s%
cigarette%brand%under%licensing%agreement%with%Tobacco%
Industries,%on%May%18,%1988,%and%GALLO%SPECIAL%
MENTHOL%100s%cigarette%brand%on%April%3,%1989.%
•% Although%the%GALLO%wine%trademark%was%registered%in%
the%Philippines%in%1971,%respondents%claim%that%they%first%
introduced%and%sold%the%GALLO%and%ERNEST%&%JULIO%
GALLO%wines%in%the%Philippines%circa%1974%within%the%
then%U.S.%military%facilities%only.%By%1979,%they%had%
distributors%and%independent%outlets.%
•% Respondents%claim%that%they%first%learned%about%the%
existence%of%GALLO%cigarettes%in%the%latter%part%of%1992%
when%an%Andresons%employee%saw%such%cigarettes%on%
display%with%GALLO%wines%in%a%Davao%supermarket%wine%
cellar%section.%
%
•% Respondents% sent% a% demand% letter% to% petitioners% asking%
them%to%stop%using%the%GALLO%trademark,%to%no%avail.%
•% Respondents:%%
#% Charged%petitioners%with%violating%Article%6bis%of%
the%Paris%Convention%for%the%Protection%of%
Industrial%Property%(Paris%Convention)%and%RA%
166%(Trademark%Law),%specifically,%Sections%22%
and%23%(for%trademark%infringement),%29%and%
30%%(for%unfair%competition%and%false%
designation%of%origin)%and%37%(for%tradename%
infringement).%
#% Claimed%that%petitioners%adopted%the%GALLO%
trademark%to%ride%on%Gallo%Winerys%GALLO%and%
ERNEST%&%JULIO%GALLO%trademarks%
established%reputation%and%popularity,%thus%
causing%confusion,%deception%and%mistake%on%
the%part%of%the%purchasing%public%who%had%
always%associated%GALLO%and%ERNEST%&%
JULIO%GALLO%trademarks%with%Gallo%Winerys%
wines.%
•% Petitioners:%
#% Their%cigarette%products%and%Gallo%Winery%
wines%were%unrelated%products.%Gallo%
Winery’s%GALLO%trademark%covers%wine%
only,%not%cigarettes.%%
#% GALLO%cigarettes%and%GALLO%wines%were%
sold%through%different%channels%of%trade.%
#% %They%also%have%different%target%markets%
cause%Gallo%Winerys%wines%were%for%middle%
or%high%income%groups%while%the%GALLO%
cigarette%were%for%low%income%workers%%
#% The%dominant%feature%of%the%GALLO%
cigarette%mark%was%the%rooster%device%with%
the%manufacturers%name%clearly%indicated%
as%MIGHTY%CORPORATION%while,%in%the%
case%of%Gallo%Winerys%wines,%it%was%the%full%
names%of%the%foundersZowners%ERNEST%&%
JULIO%GALLO%or%just%their%surname%GALLO%%
•% RTC:%denied%the%complaint%filed%by%respondent.%Held%that%
respondents%GALLO%trademark%covered%wines%only.%It%
also%held%that%respondents%wines%and%petitioners%
cigarettes%were%not%related%goods.%
•% CA:%dismissed%respondents%petition%for%review%
•% After%trial%on%the%merits,%however,%the%Makati%RTC,%on%
November%26,%1998,%held%petitioners%liable%for,%and%
permanently%enjoined%them%from,%committing%trademark%
infringement%and%unfair%competition%with%respect%to%the%
GALLO%trademark.%
•% CA:%affirmed%RTC%
%
ISSUE:%
WON%Mighty%is%guilty%of%trademark%infringement?%Z%NO%
HELD:%
%
•% The%Trademark%Law%and%the%Paris%Convention%are%the%
applicable%laws,%not%the%Intellectual%Property%Code%so%
the%lower%courts%erred%in%retroactively%applying%the%IP%
code.%
#% The%IP%Code,%repealing%the%Trademark%Law%was%
approved%on%June%6,%1997.%Section%241%thereof%
expressly%decreed%that%it%was%to%take%effect%only%on%
%
January%1,%1998,%without%any%provision%for%
retroactive%application.%Thus,%the%Makati%RTC%and%
the%CA%should%have%limited%the%consideration%of%
the%present%case%within%the%parameters%of%the%
Trademark%Law%and%the%Paris%Convention,%the%
laws%in%force%at%the%time%of%the%filing%of%the%
complaint.%
•% Trademark%Infringement%and%Unfair%Competition:%
Z% Common%concept:%a%person%shall%not%be%permitted%
to%misrepresent%his%goods%or%his%business%as%the%
goods%or%business%of%another,%
Z% the%law%on%unfair%competition%is%broader%and%more%
inclusive%than%the%law%on%trademark%
infringement.%The%latter%is%more%limited%but%it%
recognizes%a%more%exclusive%right%derived%from%the%
trademark%adoption%and%registration%by%the%person%
whose%goods%or%business%is%first%associated%with%
it.%%Even%if%one%fails%to%establish%his%exclusive%
property%right%to%a%trademark,%he%may%still%obtain%
relief%on%the%ground%of%his%competitors%unfairness%
or%fraud.%Conduct%constitutes%unfair%competition%if%
the%effect%is%to%pass%off%on%the%public%the%goods%of%
one%man%as%the%goods%of%another.%%
•% The% Paris% Convention% protects% wellZknown% trademarks%
only%(to%be%determined%by%domestic%authorities),%while%the%
Trademark% Law% protects% all% trademarks,% whether% wellZ
known%or%not,%provided%that%they%have%been%registered%and%
are%in%actual%commercial%use%in%the%Philippines.%Following%
universal% acquiescence% and% comity,% in% case% of% domestic%
legal% disputes% on% any% conflicting% provisions% between% the%
Paris% Convention% (which% is% an% international% agreement)%
and%the%Trademark%law%(which%is%a%municipal%law)%the%latter%
will%prevail%
•% Under%both%laws,%the%protection%of%a%registered%trademark%
is% limited% only% to% goods% identical% or% similar% to% those% in%
respect% of% which% such% trademark% is% registered% and% only%
when%there%is%likelihood%of%confusion%and%the%time%element%
in% commencing% infringement% cases% is% material% in%
ascertaining%the%registrants%express%or%implied%consent%to%
anothers% use% of% its% trademark% or% a% colorable% imitation%
thereof.% Hence,% proof% of% all% the% elements% of% trademark%
infringement% is% a% condition% precedent% to% any% finding% of%
liability.%
•% To%prove%commercial%use%of%the%GALLO%wine%trademark%
in%the%Philippines,%respondents%presented%sales%invoice%
no.%29991%dated%July%9,%1981%addressed%to%Conrad%
Company%Inc.,%Makati,%Philippines%and%sales%invoice%no.%
85926%dated%March%22,%1996%addressed%to%Andresons%
Global,%Inc.,%Quezon%City,%Philippines.%Both%invoices%were%
for%the%sale%and%shipment%of%GALLO%wines%to%the%
Philippines%during%that%period.%
•% However,%nothing%was%presented%as%evidence%to%prove%the%
alleged%sales%of%GALLO%wines%in%the%Philippines%in%1974%
or,%for%that%matter,%prior%to%July%9,%1981.%
•% BIR%authorization%letters,%forms%and%manufacturers%sworn%
statement,%it%appears%that%petitioners%and%its%predecessorZ
inZinterest,%Tobacco%Industries,%have%indeed%been%using%
and%selling%GALLO%cigarettes%in%the%Philippines%since%
1973%or%before%July%9,%1981%
•% So%the%actual%commercial%use%of%the%GALLO%wine%
trademark%was%subsequent%to%its%registration%in%1971%
and%to%Tobacco%Industries%commercial%use%of%the%
GALLO%cigarette%trademark%in%1973%hence,%
respondents%never%enjoyed%the%exclusive%right%to%use%
the%GALLO%wine%trademark%to%the%prejudice%of%
Tobacco%Industries%and%its%successors>in>interest,%
%
herein%petitioners,%either%under%the%Trademark%Law%or%
the%Paris%Convention%
•% Respondents%GALLO%trademark%registration%is%limited%
to% WINES% ONLY.Their% certificates% state% that% they% cover%
wines" only" without% any% evidence% or% indication% that%
registrant% Gallo% Winery% expanded% or% intended% to% expand%
its% business% to% cigarettes.% So% their% exclusive% right% to% the%
GALLO%trademark%should%be%limited%to%wines.%%
•% There%is%no%likelihood%of%confusion,%mistake%or%deceit%as%to%
the%identity%or%source%of%petitioners%and%respondents%goods%
or%business.%%
#% Two%types%of%confusion:%%
#% 1.%Confusion%of%goods%when%an%otherwise%prudent%
purchaser%is%induced%to%purchase%one%product%in%the%
belief%that%he%is%purchasing%another,%in%which%case%
defendants%goods%are%then%bought%as%the%plaintiffs%
and% its% poor% quality% reflects% badly% on% the% plaintiffs%
reputation.%
#% 2.%Confusion%of%business%wherein%the%goods%of%the%
parties%are%different%but%the%defendants%product%can%
reasonably% (though% mistakenly)% be% assumed% to%
originate%from%the%plaintiff,%thus%deceiving%the%public%
into% believing% that% there% is% some% connection%
between%the%plaintiff%and%defendant%which,%in%fact,%
does%not%exist.%
#% To%determine%the%likelihood%of%confusion,%the%Court%
considers:% [a]% the% resemblance% between% the%
trademarks`%[b]%the%similarity%of%the%goods%to%which%
the%trademarks%are%attached`%[c]%the%likely%effect%on%
the% purchaser% and% [d]% the% registrants% express% or%
implied% consent% and% other% fair% and% equitable%
considerations.%
#% The%use%of%dominancy%test%and%holistic%test%is%also%
used% to% determine% the% similarity% and% likelihood% of%
confusion%in%trademark%resemblance.%
#% The%Dominancy%Test%focuses%on%the%similarity%of%
the%prevalent%features%of%the%competing%
trademarks%which%might%cause%confusion%or%
deception,%and%thus%infringement.%
#% The%Holistic%Test%requires%that%the%entirety%of%the%
marks%in%question%be%considered%in%resolving%
confusing%similarity.%
#% The%many%different%features%like%color%schemes,%art%
works%and%other%markings%of%both%products%drown%
out%the%similarity%between%them%the%use%of%the%word%
GALLO%―%a%family%surname%for%the%Gallo%Winerys%
wines%and%a%Spanish%word%for%rooster%for%petitioners%
cigarettes.%
#% The%Court%applied%both%dominancy%and%holistic%test%
and%found%that%the%GALLO%cigarette%trademark%is%
the%device%of%a%large%rooster%facing%left,%outlined%in%
black%against%a%gold%background.%The%roosters%
color%is%either%green%or%red%green%for%GALLO%
menthols%and%red%for%GALLO%filters.%Directly%below%
the%large%rooster%device%is%the%word%GALLO.%The%
rooster%device%is%given%prominence%in%the%GALLO%
cigarette%packs%in%terms%of%size%and%location%on%the%
labels.%
#% The%GALLO%mark%appears%to%be%a%fanciful%and%
arbitrary%mark%for%the%cigarettes%as%it%has%no%
relation%at%all%to%the%product%but%was%chosen%
merely%as%a%trademark%due%to%the%fondness%for%
fighting%cocks%of%the%son%of%petitioners%
president.%Furthermore,%petitioners%adopted%
GALLO,%the%Spanish%word%for%rooster,%as%a%
%
cigarette%trademark%to%appeal%to%one%of%their%target%
markets,%the%sabungeros%%
#% On%the%side%of%the%GALLO%cigarette%packs%are%the%
words%MADE%BY%MIGHTY%CORPORATION,%thus%
clearly%informing%the%public%as%to%the%identity%of%the%
manufacturer%of%the%cigarettes.%
#% GALLO%Winerys%wine%and%brandy%labels%are%
diverse.%In%many%of%them,%the%labels%are%
embellished%with%sketches%of%buildings%and%trees,%
vineyards%or%a%bunch%of%grapes%while%in%a%few,%one%
or%two%small%roosters%facing%right%or%facing%each%
other%and%directly%below%or%above%these%sketches%
is%the%entire%printed%name%of%the%founderZowners,%
ERNEST%&%JULIO%GALLO%or%just%their%surname%
GALLO%
#% Wines%and%cigarettes%are%not%identical,%similar,%
competing%or%related%goods.%%
#% The%question%is:%whether%there%exists%a%
likelihood%that%an%appreciable%number%of%
ordinarily%prudent%purchasers%will%be%misled,%or%
simply%confused,%as%to%the%source%of%the%goods%
in%question.%
#% There%is%due%regard%given%to%the%goods%usual%
purchasers%character,%attitude,%habits,%age,%
training%and%education.%
#% Petitioners%use%of%the%GALLO%cigarette%
trademark%is%not%likely%to%cause%confusion%or%
mistake,%or%to%deceive%the%ordinarily%intelligent%
buyer%of%either%wines%or%cigarettes%or%both%as%to%
the%identity%of%the%goods,%their%source%and%
origin,%or%identity%of%the%business%of%petitioners%
and%respondents.%
#% Obviously,%wines%and%cigarettes%are%not%
identical%or%competing%products.%Neither%do%
they%belong%to%the%same%class%of%goods.%
Respondents%GALLO%wines%belong%to%Class%33%
under%Rule%84[a]%Chapter%III,%Part%II%of%the%
Rules%of%Practice%in%Trademark%Cases%while%
petitioners%GALLO%cigarettes%fall%under%Class%
34.%
#% The%lowers%courts%erred%when%it%ruled%that%
wines%and%cigarettes%are%related%products%
because%they%are%related%forms%of%vices%and%
are%grouped%in%the%same%section%in%groceries.%%
#% The%GALLO%wine%trademark%is%NOT%a%wellZknown%mark%in%
the%context%of%the%Paris%Convention%in%this%case%since%
wines%and%cigarettes%are%not%identical%or%similar%goods.%%
#% GALLO%wines%and%GALLO%cigarettes%are%neither%
the%same,%identical,%similar%nor%related%goods,%
a%requisite"element%under%both%the%Trademark%Law%
and%the%Paris%Convention.%
#% Second,%the%GALLO%trademark%cannot%be%
considered%a%strong%and%distinct%mark%in%the%
Philippines.%
#% "Pursuant"to"the"ruling"in"Canon%Kabushiki%Kaisha%
vs.%Court%of%Appeals%and%NSR%Rubber%Corporation%
GALLO"cannot"be"considered"a"wellUknown"mark"
within"the"contemplation"and"protection"of"
the"Paris"Convention"in"this"case"since"wines"and"
cigarettes"are"not"identical"or"similar"goods."
(please"read"nalang"yung"portion"sa"full"text"$")%
#% It%took%respondents%almost%20%years%to%know%about%the%
existence%of%GALLO%cigarettes%and%sue%petitioners%for%
trademark%infringement%despite%the%fact%that%petitioners%
were%engaged%in%the%market%of%GALLO%cigarettes%for%a%
 %
long%period%of%time.%The%Court%held%that%equity,%justice% •%
and%fairness%require%them%to%rule%in%favor%of%petitioners.%%
#% Petitioner%is%not%liable%for%unfair%competition.%% •%
#% Section%29%of%the%Trademark%Law,%any%person%who%
employs%deception%or%any%other%means%contrary%to%
good%faith%by%which%he%passes%off%the%goods% •%
manufactured%by%him%or%in%which%he%deals,%or%his%
business,%or%services%for%those%of%the%one%having%
established%such%goodwill,%or%who%commits%any%
acts%calculated%to%produce%said%result,%is%guilty%of%
unfair%competition.% •%
#% Petitioners%never%attempted%to%pass%off%their%
cigarettes%as%those%of%respondents.%% •%
#% No%bad%faith%or%fraud%imputable%to%petitioners%
% and%nearby%provinces.%%
% •%
% for%the%registration"of%the%Big%Mak%mark%for%its%hamburger%
183.% McDonald's% Corp% v.% L.C.% Big% Mak,% GR% 143993% dated% 18%
August%2004%
% •%
Facts:% •%
•% Petitioner%McDonalds%is%a%corporation%organized%under%the%laws%
•%
of%Delaware,%United%States.%
•% McDonalds%owns%a%family%of%marks%including%the%Big%Mac%mark%
for%its%doubleZdecker%hamburger%sandwich%which%was%registered%
in%United%States%Trademark%Registry%on%16%October%1979.%
McDonalds%applied%for%the%registration"of%the%same%mark%in%
the%Principal%Register%of%the%Philippine%Bureau%of%Patents,%
Trademarks%and%Technology%(PBPTT)."%
Sept%1981%Z%While%the%application%is%Pending,%McDonalds%
introduced%its%Big%Mac%hamburger%sandwiches%in%the%PH.%%
18%July%1985%Z%PBPTT%allowed%registration"of%the%Big%Mac%mark%
in%the%PrincipalRegister%based%on%its%Home%Registration%in%the%
US.%
McDonalds%displays%the%Big%Mac%mark%in%items%and%
paraphernalia%in%its%restaurants,%and%in%its%outdoor%and%
indoor%signages.%From%1982%to%1990,%McDonalds%
spent%P10.5%million%in%advertisement%for%Big%Mac%hamburger%
sandwiches%alone.%%
Petitioner%McGeorge%Food%Industries,%a%domestic%corporation,%is%
McDonalds%Philippine%franchisee.%%
Respondent%L.C.%Big%Mak%Burger,%Inc.%is%a%domestic%corporation%
which%operates%fastZfood%outlets%and%snack%vans%in%Metro%Manila%
21%Oct%1988%Z%respondent%applied%with%the%PBPTT%
sandwiches.%McDonalds%opposed%respondent‘s%application%on%
the%ground%that%Big%Mak%was%a%colorable%imitation%of%its%
registered%Big%Mac%mark%for%the%same%food%products.%
McDonalds%also%informed%of%its%exclusive%right%to%the%mark%and%
requested%to%desist%from%using%it.%
6%June%1990%Z%petitioners%on%sued%respondents%for%trademark%
infringement%and%unfair%competition.%
RTC%issued%TRO%against%respondents%and%rendered%judgment%
finding%respondent%corporation%liable%for%trademark%infringement%
and%unfair%competition.%RTC%reasoned%that%“There"exist%some%
distinctions%between%the%names%"Big%Mac"%and%"Big%Mak"%as%
appearing%in%the%respective%signages,%wrappers%and%containers%
of%the%food%products%of%the%parties.%But%infringement%goes%
beyond%the%physical%features%of%the%questioned%name%and%the%
original%name.%There%are%still%other%factors%to%be%considered.”%
 %
RTC% also% stated% in% its% decisioin% that% the% contending% parties% are%
both% in% the% business% of% fastZfood% chains% and% restaurants.% An%
average% person% who% is% hungry% and% wants% to% eat% a% hamburger%
sandwich% may% not% be% discriminating% enough% to% look% for% a%
McDonald's%restaurant%and%buy%a%"Big%Mac"%hamburger.%Once%he%
sees%a%stall%selling%hamburger%sandwich,%in%all%likelihood,%he%will%
dip%into%his%pocket%and%order%a%"Big%Mak"%hamburger%sandwich.%
•% CA%reversed%RTC%decision.%%CA%is%fully%convinced%that%no%
colorable%imitation%exists.%As%the%definition%dictates,%it%is%
not%sufficient%that%a%similarity%exists%in%both%names,%but%
that%more"importantly,%the%over>all%presentation,%or%in%their%
essential,%substantive%and%distinctive%parts%is%such%as%would%
likely%MISLEAD%or%CONFUSE%persons%in%the%ordinary%course%
of%purchasing%the%genuine%article.%%
% once%registered,%not%only%the%mark's%validity%but%also%the%
ISSUE%1:%Whether%or%not%respondents%used%the%words%"Big%Mak"%
not%only%as%part%of%the%corporate%name%"L.C.%Big%Mak%Burger,%Inc."%
but%also%as%a%trademark%for%their%hamburger%products%
HELD:%Yes%
•% Respondents'%plastic%wrappers%and%bags%were%identical%
with%those%petitioner’s%except%that%the%letters%"L.C."%and%
the%words%"Burger,%Inc."%in%respondents'%evidence%were%
added%above%and%below%the%words%"Big%
Mak,"%respectively.%%
%
ISSUE% 2:% Whether% or% not% respondent% is% liable% for% trademark%
infringement%and%unfair%competition.%
HELD:%Yes%
•% To%establish%trademark%infringement,%the%ff%elements%must%
be%shown:%%
I.% validity%of%plaintiff's%mark%
II.% plaintiff's%ownership%of%the%mark%
III.% use"of%the%mark%or%its%colorable%imitation%by%
the%alleged%infringer%results%in%"likelihood%of%
confusion."%%
Of%these,%it%is%the%element"of%likelihood%of%confusion%that%is%
the%gravamen%of%trademark%infringement.%
I.&"II."On"the"Validity"of"the""Big"Mac"Mark"and"McDonald's"
Ownership"of"such"Mark"–"not"valid"&"plaintiff"is"the"owner.%
•% A%mark%is%valid%if%it%is%"distinctive"%and%thus%not%barred%
from%registration%under%Section%4%of%RA%166%However,%
registrant's%ownership%of%the%mark%is%prima%facie%
presumed.%
•% Respondents%contend%that%of%the%two%words%in%the%"Big%
Mac"%mark,%it%is%only%the%word%"Mac"%that%is%valid%because%
the%word%"Big"%is%generic%and%descriptive%and%thus%
"incapable%of%exclusive%appropriation."%
•% The%"Big%Mac"%mark%should%be%treated%in%its%entirety%and%
not%dissected%word%for%word.%It%is%neither%generic%nor%
descriptive.%%
o% Generic%marks%are%commonly%used%as%the%name%
or%description%of%a%kind"o"fgoods,%such%as%"Lite"%for%
beer%or%"Chocolate%Fudge"%for%chocolate%soda%
drink.%%
o% Descriptive%marks%Z%convey%the%
characteristics,%functions,%qualities%or%ingredients%
of%a%product%to%one%who%has%never%seen%it%or%does%
%
not%know%it%exists,%such%as%"Arthriticare"%for%arthritis%
medication.%
•% On%the%contrary,%"Big%Mac"%falls%under%the"class"of%fanciful%
or%arbitrary%marks%as%it%bears%no%logical%relation%to%
the%actual%characteristics%of%the%product%it%represents.%As"
such,%it%is%highly%distinctive%and%thus%valid.%%
•% Petitioners%also%have%duly%established%McDonald's%
exclusive%ownership%of%the%"Big%Mac"%mark.%%
o% Although%Topacio%and%the%Isaiyas%Group%
registered%the%"Big%Mac"%mark%ahead%of%
McDonald's,%Topacio,%as%petitioners%disclosed,%had%
already%assigned%his%rights%to%McDonald's.%The%
Isaiyas%Group%registered%its%trademark%only%in%the%
Supplemental%Register.%A%mark%which%is%not%
registered%in%the%Principal%Register,%and%thus%not%
distinctive,%has%no%real%protection.%%
II."Use"of"the"mark"or"its"colorable"imitation"by"
the"alleged"infringer"results"in""likelihood"of"confusion.”"U"YES"
•% Two%Types%of%confusion%arising%from%the"use"of%similar%or%
colorable%imitation%marks:%%
1.%confusion%of%goods%/%product%confusion%Z%in%which%event%the%
ordinarily%prudent%purchaser%would%be%induced%to%purchase%
one%product%in%the%belief%that%he%was%purchasing%the%other%
2.%confusion%of%business%/%source%or%origin%confusion%Z%the%
goods%of%the%parties%are%different,%the%defendant's%product%
is%such%as%might%reasonably%be%assumed%to%originate%with%
the%plaintiff,%and%the%public%would%then%be%deceived%either%
into%that%belief%or%into%the%belief%that%there%is%some%
connection%between%the%plaintiff%and%defendant%which,%in"
fact,%does%not%exist.”%
•% there%is%confusion%of%goods%when%the%products%are%
competing,%confusion%of%business%exists%when%the%products%
are%nonZcompeting%but%related%enough%to%produce%confusion%
of%affiliation.%In%this%case,%both%confusion%of%goods%and%
confusion%of%business%apply.%
o% “Defendants'%unauthorized%acts%are%likely,%and%
calculated,%to%confuse,%mislead%or%deceive%the%
public%into%believing%that%the%products%and%services%
offered%by%defendant%Big%Mak%Burger,%and%the%
business%it%is%engaged%in,%are%approved%and%
sponsored%by,%or%affiliated%with,%plaintiffs.”%
o% For%a%period"of"time,%defendant%Big%Mak%Burger%
acting%through%individual%defendants,%has%been%
operating%"Big%Mak%Burger",%a%fast%food%restaurant%
business%dealing%in%the%sale%of%food%and%has%
caused%to%be%printed%on%the%wrapper%of%
defendant's%food%products%and%incorporated%in%its%
signages%the%name%"Big%Mak%Burger",%which%is%
confusingly%similar%to%and/or%is%a%colorable%
imitation%of%the%plaintiff%McDonald's%mark%"Big%Mac”%
which%are%likely%to%have%caused%confusion%or%
deceived%the%public%as!to%the%true%source,%
sponsorship%or%affiliation%of%defendants'%food%
products%and%restaurant%business.%
o% Respondents"admit"that"their"business"includes"
selling"hamburger"sandwiches,"the"same"food"
product"that"petitioners"sell"using"the""Big"Mac""
mark."Thus,%trademark%infringement%through%
confusion%of%business%is%also%a%proper%issue%in%this%
case.%
•% In%determining%likelihood%of%confusion,%jurisprudence%has%
developed%two%tests:%
%
1.% Dominancy%test%focuses%on%the%similarity%of%
the%prevalent%features%of%the%competing%
trademarks%that%might%cause%confusion.%%
2.% Holistic%test%requires%the%court%to%consider%the%
entirety%of%the%marks%as%applied%to%the%products,%
including%the%labels%and%packaging,%
in%determining%confusing%similarity.%
•% SC%relied%on%the%dominancy%test.%The%dominancy%test%
considers%the%dominant%features%in%the%competing%marks%
in%determining%whether%they%are%confusingly%similar.%Under%
the%dominancy%test,%courts%give%greater%weight%to%the%
similarity%of%the%appearance%of%the%product%arising%
from%the%adoption"of%the%dominant%features%of%the%registered%
mark,%disregarding%minor%differences.%%
•% Through%the%test,%Court%finds%that%respondents'%use%of%the%
"Big%Mak"%mark%results%in%likelihood%of%confusion.%First,%"Big%
Mak"%sounds%exactly%the%same%as%"Big%Mac."%Second,%the%
first%word%in%"Big%Mak"%is%exactly%the%same%as%the%first%word%in%
"Big%Mac."%Third,%the%first%two%letters%in%"Mak"%are%the%same%
as%the%first%two%letters%in%"Mac."%Fourth,%the%last%letter%in%
"Mak"%while%a%"k"%sounds%the%same%as%"c"%when%the%word%
"Mak"%is%pronounced.%Fifth,%in%Filipino,%the%letter%"k"%replaces%
"c"%in%spelling,%thus%"Caloocan"%is%spelled%"Kalookan."%In%
short,%the%two%marks%are%the%same,%with%the%first%word%
of%both%marks%phonetically%the%same,%and%the%second%word%
of%both%marks%also%phonetically%the%same.%Visually,%the%two%
marks%have%both%two%words%and%six%letters,%with%the%first%word%
of%both%marks%having%the%same%letters%and%the%second%word%
having%the%same%first%two%letters.%In%spelling,%considering%the%
Filipino%language,%even%the%last%letters%of%both%marks%are%the%
same.%
•% Clearly,!respondents!have!adopted!in!"Big!Mak"!not!only!
the!dominant!but!also!almost!all!the!features!of!"Big!
Mac."%Applied%to%the%same%food%product%of%hamburgers,%the%
two%marks%will%likely%result%in%confusion%in%the%public%mind.%
o% Court%has%taken%into%account%the%aural%effects%of%
the%words%and%letters%contained"in%the%marks%
in%determining"the"issue"of%confusing%similarity:%
#% "Big%Mac"%and%"Big%Mak"%for%hamburgers%
create%even%greater%confusion,%not%only%
aurally%but%also%visually.%Indeed,%a%person%
cannot%distinguish%"Big%Mac"%from%"Big%Mak"%
by%their%sound%Z%one%would%not%know%
whether%the%"Mac"%or%"Mak"%ends%with%a%"c"%
or%a%"k."%
#% Petitioners'%aggressive%promotion%of%the%
"Big%Mac"%mark,%as%borne%by%their%
advertisement%expenses,%has%built%goodwill%
and%reputation%for%such%mark%making%it%one%
of%the%easily%recognizable%marks%in%the%
market%today.%%
#% Respondents'%inability%to%
explain%sufficiently%how%and%why%they%came%
to%choose%"Big%Mak"%for%their%hamburger%
sandwiches%indicates%their%intent%to%imitate%
petitioners'%"Big%Mac"%mark.%%
%
%
%
McDONALDS%CORPORATION,%Petitioner,%>%versus%>%MACJOY%
FASTFOOD%CORPORATION,%Respondent.%
Doctrine:% Courts% has% consistently% used% and% applied% the%
dominancy%test%in%determining%confusing%similarity%or%likelihood%of%
confusion%between%competing%trademarks.%The%dominancy%test%
focuses% on% the% similarity% of% the% prevalent% features% of% the%
competing%trademarks%that%might%cause%confusion%or%deception.%%
Facts:%%
•% 14%March%1991,%respondent%MacJoy%Fastfood%Corporation,%
a% domestic% corporation% engaged% in% the% sale% of% fast% food%
products% in% Cebu% City,% filed% with% the% then% Bureau% of%
Patents,% Trademarks% and% Technology% Transfer% (BPTT),%
now%the%Intellectual%Property%Office%(IPO),%an%application%
for% the% registration% of% the% trademark% MACJOY% &%
DEVICE% for% fried% chicken,% chicken% barbeque,% burgers,%
fries,%spaghetti,%palabok,%tacos,%sandwiches,%haloZhalo%and%
steaks% under% classes% 29% and% 30% of% the% International%
Classification%of%Goods.%
•% McDonalds% Corporation% filed% a% verified% Notice" of"
Opposition" against% Macjoy% claiming% that% the% trademark%
MACJOY%&%DEVICE%so%resembles%its%corporate%logo%such%
that% when% used% on% identical% or% related% goods,% the%
trademark% applied% for% would% confuse% or% deceive%
purchasers%into%believing%that%the%goods%originate%from%the%
same%source%or%origin.%
•% Likewise,%the%petitioner%alleged%that%the%respondents%use%
and%adoption%in%bad%faith%of%the%MACJOY%&%DEVICE%mark%
would% falsely% tend% to% suggest% a% connection% or% affiliation%
with% petitioners% restaurant% services% and% food% products,%
thus,% constituting% a% fraud% upon% the% general% public% and%
further% cause% the% dilution% of% the% distinctiveness% of%
petitioners% registered% and% internationally% recognized%
MCDONALDS% marks% to% its% prejudice% and% irreparable%
damage.% The% application% and% the% opposition%
thereto%was%docketed%as%Inter"Partes"Case"No."3861.%
•% Respondent% denied% allegations% and% averred% that% it% has%
used%the%mark%MACJOY%for%the%past%many%years%in%good%
faith%and%has%spent%considerable%sums%of%money%for%said%
marks%extensive%promotion%in%triZmedia,%especially%in%Cebu%
City% where% it% has% been% doing% business% long% before% the%
petitioner%opened%its%outlet%thereat%sometime%in%1992`%and%
that%its%use%of%said%mark%would%not%confuse%affiliation%with%
the% petitioners% restaurant% services% and% food% products%
because%of%the%differences%in%the%design%and%detail%of%the%
two%(2)%marks.%
•% IPO% decided:% ratiocinating% that% the% predominance% of% the%
letter%M,%and%the%prefixes%Mac/Mc%in%both%the%MACJOY%and%
the%MCDONALDS%marks%lead%to%the%conclusion%that%there%
is%confusing%similarity%between%them%especially%since%both%
are% used% on% almost% the% same% products% falling% under%
classes% 29% and% 30% of% the% International% Classification% of%
Goods,% i.e.," food% and% ingredients% of% food,% sustained% the%
petitioners% opposition% and% rejected% the% respondents%
application.%
•% Respondent% moved% for% reconsideration% but% IPO% denied.%
Respondent%went%up%to%the%CA%via%via"a%Petition%for%Review%
with%prayer%for%Preliminary%Injunction.%%
•% CA,% finding% no% confusing% similarity% between% the% marks%
MACJOY% and% MCDONALDS,% reversed% and% set% aside%
decision% of% the% IPO.% :% 1.% The% word% MacJoy% is% written% in%
round%script%while%the%word%McDonalds%is%written%in%single%
stroke%gothic`%%2.%The%word%MacJoy%comes%with%the%picture%
of%a%chicken%head%with%cap%and%bowtie%and%wings%sprouting%
on%both%sides,%while%the%word%McDonalds%comes%with%an%
%
arches%M%in%gold%colors,%and%absolutely%without%any%picture%
of%a%chicken`%3.%The%word%MacJoy%is%set%in%deep%pink%and%
white% color% scheme% while% McDonalds% is% written% in% red,%
yellow% and% black% color% combination`% 4.% The% faade% of% the%
respective% stores% of% the% parties% are% entirely%
different.% Exhibits% 1% and% 1ZA,% show% that% [respondents]%
restaurant% is% set% also% in% the% same% bold,% brilliant% and%
noticeable% color% scheme% as% that% of% its% wrappers,%
containers,% cups,% etc.,% while% [petitioners]% restaurant% is% in%
yellow% and% red% colors,% and% with% the% mascot% of% Ronald%
McDonald%being%prominently%displayed%therein.%(Words%in%
brackets%supplied.)%
•% Petitioners%filed%a%Motion%for%Reconsideration.%%
Issue:% WON% there% is% a% confusing% similarity% between% the%
MCDONALDS% marks% of% the% petitioner% and% the% respondents%
MACJOY%&%DEVICE%trademark%when%applied%to%Classes%29%and%
30% of% the% International% Classification% of% Goods,% i.e.,% food% and%
ingredients%of%food.%
Held:% In% determining% similarity% and% likelihood% of% confusion,%
jurisprudence%has%developed%two%tests,%the%dominancy!test%and%
the%holistic!test.%The%dominancy%test%focuses%on%the%similarity%of%
the% prevalent% features% of% the% competing% trademarks% that% might%
cause% confusion% or% deception.% In% contrast,% the% holistic% test%
requires%the%court%to%consider%the%entirety%of%the%marks%as%applied%
to% the% products,% including% the% labels% and% packaging,% in%
determining% confusing% similarity.% Under% the% latter% test,% a%
comparison% of% the% words% is% not% the% only% determinant% factor.% In%
recent%cases%with%a%similar%factual%milieu%as%here,%the%Court%has%
consistently% used% and% applied% the% dominancy% test% in%
determining%confusing%similarity%or%likelihood%of%confusion%
between%competing%trademarks.%
%McDonalds"Corp."v."LC"Big"Mak%Burger,"Inc.":"The%dominancy%
test%considers%the%dominant%features%in%the%competing%marks%in%
determining% whether% they% are% confusingly% similar.% Under% the%
dominancy%test,%courts%give%greater%weight%to%the%similarity%of%the%
appearance% of% the% product% arising% from% the% adoption% of% the%
dominant% features% of% the% registered% mark,% disregarding% minor%
differences.% Courts% will% consider% more% the% aural% and% visual%
impressions%created%by%the%marks%in%the%public%mind,%giving%little%
weight% to% factors% like% prices,% quality,% sales% outlets% and% market%
segments.%
Applying%the%dominancy%test%to%the%instant%case,%the%Court%finds%
that%herein%petitioners%MCDONALDS%and%respondents%MACJOY%
marks% are% confusingly% similar% with% each% other% such% that% an%
ordinary% purchaser% can% conclude% an% association% or% relation%
between%the%marks.%
To%begin%with,%both%marks%use%the%corporate%M%design%logo%and%
the%prefixes%Mc%and/or%Mac%as%dominant%features.%The%first%letter%
M%in%both%marks%puts%emphasis%on%the%prefixes%Mc%and/or%Mac%by%
the% similar% way% in% which% they% are% depicted% i.e.% in% an% archZlike,%
capitalized%and%stylized%manner%
For%sure,%it%is%the%prefix%Mc,%an%abbreviation%of%Mac,%which%visually%
and%aurally%catches%the%attention%of%the%consuming%public.%Verily,%
the% word% MACJOY% attracts% attention% the% same% way% as% did%
McDonalds,%MacFries,%McSpaghetti,%McDo,%Big%Mac%and%the%rest%
of%the%MCDONALDS%marks%which%all%use%the%prefixes%Mc%and/or%
Mac.%
%Besides%and%most%importantly,%both%trademarks%are%used%in%the%
sale% of% fastfood% products.% Indisputably,% the% respondents%
trademark% application% for% the% MACJOY% &% DEVICE% trademark%
covers% goods% under% Classes% 29% and% 30% of% the% International%
%
Classification%of%Goods,%namely,%fried%chicken,%chicken%barbeque,%
burgers,%fries,%spaghetti,%etc.%Likewise,%the%petitioners%trademark%
registration%for%the%MCDONALDS%marks%in%the%Philippines%covers%
goods%which%are%similar%if%not%identical%to%those%covered%by%the%
respondents%application.%

Moreover,%Respondents%contention%that%it%was%the%first%user%of%the%
mark%in%the%Philippines%having%used%MACJOY%&%DEVICE%on%its%
restaurant% business% and% food% products% since% December,% 1987%
at% CebuCity% while% the% first% McDonalds% outlet% of% the% petitioner%
thereat% was% opened% only% in% 1992,% is% downright%
unmeritorious.% For% the% requirement% of% actual% use% in% commerce%
x% x% x% in% the% Philippines% before% one% may% register% a% trademark,%
tradeZname%and%service%mark%under%the%Trademark%Law%pertains%
to% the% territorial% jurisdiction% of% the% Philippines% and% is% not% only%
confined%to%a%certain%region,%province,%city%or%barangay.%

%
%
185% CAGAYAN% VALLEY% ENTERPRISES,% INC.,% Represented%
by%its%President,%Rogelio%Q.%Lim,%vs.!THE%HON.%COURT%OF%
APPEALS%and%LA%TONDEÑA,%INC.%%
G.R.%No.%78413.%November%8,%1989%–%CIVIL"REMEDIES"(Cases"
on"bottles"and"containers)%
% Instance%of%Isabela%against%Cagayan%Valley%Enterprises,%Inc.%
DOCRTINE%
A% person% entitled% to% the% exclusive% use% of% a% registered% mark% or%
tradename% may% recover% damages% in% a% civil% action% from% any%
person%who%infringes%his%rights.—%While%Republic%Act%No.%623,%as%
amended,%provides%for%a%criminal%action%in%case%of%violation,%a%civil%
action%for%damages%is%proper%under%Article%20%of%the%Civil%Code%
which%provides%that%every%person%who,%contrary%to%law,%wilfully,%or%
negligently%causes%damage%to%another,%shall%indemnify%the%latter%
for% the% same.% This% particular% provision% of% the% Civil% Case% was%
clearly%meant%to%complement%all%legal%provisions%which%may%have%
inadvertently%failed%to%provide%for%indemnification%or%reparation%of%
damages%when%proper%or%called%for.%In%the%Language%of%the%Code%
Commission% “(t)he% foregoing% rule% pervades% the% entire% legal%
system,% and% renders% it% impossible% that% a% person% who% suffers%
damage% because% another% has% violated% some% legal% provisions,%
should%find%himself%without%relief.”%Moreover,%under%Section%23%of%
Republic% Act% No.% 166,% as% amended,% a% person% entitled% to% the%
exclusive% use% of% a% registered% mark% or% tradeZname% may% recover%
damages%in%a%civil%action%from%any%person%who%infringes%his%rights.%
He%may%also,%upon%proper%showing,%be%granted%injunction.%
FACTS%
•% Sometime%in%1953,%La%Tondeña,%Inc.%(hereafter,%LTI%for%short)%
registered% with% the% Philippine% Patent% Office% pursuant% to%
Republic%Act%No.%623%the%350%c.c.%white%flint%bottles%it%has%been%
using%for%its%gin%popularly%known%as%“Ginebra%San%Miguel”.%%
•% This%registration%was%subsequently%renewed%on%December%4,%
1974.%
•% On% November% 10,% 1981,% LTI% filed% Civil% Case% No.% 2668% for%
injunction% and% damages% in% the% then% Branch% I,% Court% of% First%
for% using% the% 350% c.c.,% white% flint% bottles% with% the% mark% “La%
Tondeña,%Inc.”%and%“Ginebra%San%Miguel”%stamped%or%blownZ
in% therein% by% filling% the% same% with% Cagayan’s% liquor% product%
bearing% the% label% “Sonny% Boy”% for% commercial% sale% and%
distribution,% without% LTI’s% written% consent% and% in% violation% of%
Section%2%of%Republic%Act%No.%623,%as%amended%by%Republic%
Act%No.%5700.%%
•% On%the%same%date,%LTI%further%filed%an%ex%parte%petition%for%the%
issuance% of% a% writ% of% preliminary% injunction% against% the%
defendant%therein.%%
•% On%November%16,%1981,%the%court%a%quo%issued%a%temporary%
restraining% order% against% Cagayan% and% its% officers% and%
employees% from% using% the% 350% c.c.% bottles% with% the% marks%
“La5Tondeña”%and%“Ginebra%San%Miguel.”%
•% Cagayan,% in% its% answer,% alleged% that% LTI% has% no% cause% of%
action%due%to%its%failure%to%comply%with%Section%21%of%Republic%
Act% No.% 166% which% requires% the% giving% of% notice% that% its%
aforesaid%marks%are%registered%by%displaying%and%printing%the%
words%“Registered%in%the%Phil.%Patent%Office”%or%“Reg.%Phil.%Pat.%
Off.,”% hence% no% suit,% civil% or% criminal,% can% be% filed% against%
Cagayan`%LTI%is%not%entitled%to%any%protection%under%Republic%
Act%No.%623,%as%amended%by%Republic%Act%No.%5700,%because%
its% products,% consisting% of% hard% liquor,% are% not% among% those%
contemplated% therein.% What% is% protected% under% said% law% are%
beverages% like% CocaZcola,% Royal% TruZOrange,% LemZOZLime%
and% similar% beverages% the% bottles% whereof% bear% the% words%
%
“Reg.% Phil.% Pat.% Off.`”% No% reservation% of% ownership% on% its%
bottles% was% made% by% LTI% in% its% sales% invoices% nor% does% it%
require%any%deposit%for%the%retention%of%said%bottles`%and%There%
was% no% infringement% of% the% goods% or% products% of% LTI% since%
Cagayan%uses%its%own%labels%and%tradeZmark%on%its%product.%
•% The%trial%court%rendered%judgment%in%favor%of%Cagayan,%ruling%
that%the%complaint%does%not%state%a%cause%of%action%and%that%
Cagayan%was%not%guilty%of%contempt.%Furthermore,%it%awarded%
damages%in%favor%of%Cagayan.%
•% LTI%appealed%to%the%Court%of%Appeals%which,%on%December%5,%
1986%rendered%a%decision%in%favor%of%said%appellant.%
%
ISSUES%
Whether%the%CA%erred%in%ruling%that%there%is,%therefore,%no%need%
for%plaintiff%to%display%the%words%“Reg.%Phil.%Pat.%Off.”%in%order%for%
it%to%succeed%in%bringing%any%injunction%suit%against%defendant%for%
the% illegal% use% of% its% bottles.% Rep.% Act% No.% 623,% as% amended% by%
Rep.%Act%No.%5700%simply%provides%and%requires%that%the%marks%
or%names%shall%be%stamped%or%marked%on%the%containers.’%Z%NO%
HELD%
The%provisions%of%Republic%Act%No.%623,%as%amended%by%Republic%
Act% No.% 5700% grant% protection% to% a% qualified% manufacturer% who%
successfully%registered%with%the%Philippine%Patent%Office%its%duly%
stamped% or% marked% bottles,% boxes,% casks% and% other% similar%
containers.% The% mere% use% of% registered% bottles% or% containers%
without%the%written%consent%of%the%manufacturer%is%prohibited,%the%
only%exceptions%being%when%they%are%used%as%containers%for%“sisi,”%
“bagoong,”% “patis”% and% similar% native% products% It% is% an% admitted%
fact%that%herein%petitioner%Cagayan%buys%from%
junk%dealers%and%retailers%bottles%which%bear%the%marks%or%names%
“La%Tondeña,%Inc.”%and%“Ginebra%San%Miguel”%and%uses%them%as%
containers%for%its%own%liquor%products.%The%contention%of%Cagayan%
that% the% aforementioned% bottles% without% the% words% “property% of”%
indicated%thereon%are%not%the%registered%bottles%of%LTI,%since%they%
do%not%conform%with%the%statement%or%description%in%the%supporting%
affidavits% attached% to% the% original% registration% certificate% and%
renewal,%is%untenable.%
Republic%Act%No.%623%which%governs%the%registration%of%marked%
bottles%and%containers%merely%requires%that%the%bottles,%in%order%to%
be%eligible%for%registration,%must%be%stamped%or%marked%with%the%
names%of%the%manufacturers%or%the%names%of%their%principals%or%
products,%or%other%marks%of%ownership.%No%drawings%or%labels%are%
required% but,% instead,% two% photographs% of% the% container,% duly%
signed%by%the%applicant,%showing%clearly%and%legibly%the%names%
and%other%marks%of%ownership%sought%to%be%registered%and%a%bottle%
showing% the% name% or% other% mark% or% ownership,% irremovably%
stamped%or%marked,%shall%be%submitted.%
%
The%term%“Name%or%Other%Mark%of%Ownership”%means%the%name%
of%the%applicant%or%the%name%of%his%principal,%or%of%the%product,%or%
other%mark%of%ownership.%The%second%set%of%bottles%of%LTI%without%
the% words% “property% of”% substantially% complied% with% the%
requirements%of%Republic%Act%No.%623,%as%amended,%since%they%
bear% the% name% of% the% principal,% La% Tondeña,% Inc.,% and% of% its%
product,%Ginebra%San%Miguel.%The%omitted%words%“property%of”%are%
not%of%such%vital%indispensability%such%that%the%omission%thereof%
will%remove%the%bottles%from%the%protection%of%the%law.%The%owner%
of% a% trademark% or% tradeZname,% and% in% this% case% the% marked%
containers,%does%not%abandon%it%by%making%minor%modifications%in%
the%mark%or%name%itself.%
%
With%much%more%reason%will%this%be%true%where%what%is%involved%is%
the%mere%omission%of%the%words%“property%of”%since%even%without%
said%words%the%ownership%of%the%bottles%is%easily%identifiable.%The%
words%“La%Tondeña.%Inc.”%and%“Ginebra%San%Miguel”%stamped%on%
the% bottles,% even% without% the% words% “property% of,”% are% sufficient%
notice%to%the%public%that%those%bottles%so%marked%are%owned%by%
LTI.%
The%claim%of%petitioner%that%hard%liquor%is%not%included%under%the%
term% “other% lawful% beverages”% as% provided% in% Section% 1% of%
Republic%Act%No.%623,%as%amended%by%Republic%Act%No.%5700,%is%
without%merit.%The%title%of%the%law%itself,%which%reads%“%An%Act%to%
Regulate% the% Use% of% Duly% Stamped% or% Marked% Bottles,% Boxes,%
Casks,% Kegs,% Barrels% and% Other% Similar% Containers”% clearly%
shows%the%legislative%intent%to%give%protection%to%all%marked%bottles%
and%containers%of%all%lawful%beverages%regardless%of%the%nature%of%
their%contents.%The%words%“other%lawful%beverages”%is%used%in%its%
general%sense,%referring%to%all%beverages%not%prohibited%by%law.%
Beverage"is"defined"as"a"liquor"or"liquid"for"drinking.%Hard"liquor,"
although"regulated,"is"not"prohibited"by"law,"hence"it"is"within"the"
purview"and"coverage"of"Republic"Act"No."623,"as"amended."
Republic% Act% No.% 623,% as% amended,% has% for% its% purpose% the%
protection%of%the%health%of%the%general%public%and%the%prevention%
of% the% spread% of% contagious% diseases.% It% further% seeks% to%
safeguard%the%property%rights%of%an%important%sector%of%Philippine%
industry.%%
% system,% and% renders% it% impossible% that% a% person% who% suffers%
The%proposition%that%Republic%Act%No.%623,%as%amended,%protects%
only% the% containers% of% the% soft% drinks% enumerated% by% petitioner%
and%those%similar%thereto,%is%unwarranted%and%specious.%The%rule%
of% ejusdem% generis% cannot% be% applied% in% this% case.% To% limit% the%
coverage%of%the%law%only%to%those%enumerated%or%of%the%same%kind%
or% class% as% those% specifically% mentioned% will% defeat% the% very%
purpose%of%the%law.%
Just%as%impuissant%is%petitioner’s%contention%that%respondent%court%
erred%in%holding%that%there%is%no%need%for%LTI%to%display%the%words%
“Reg.% Phil.% Pat.% Off.”% in% order% to% succeed% in% its% injunction% suit%
against% Cagayan% for% the% illegal% use% of% the% bottles.% To% repeat,%
Republic%Act%No.%623%governs%the%registration%of%marked%bottles%
and% containers% and% merely% requires% that% the% bottles% and/or%
containers% be% marked% or% stamped% by% the% names% of% the%
manufacturer%or%the%names%of%their%principals%or%products%or%other%
marks% of% ownership.% The% owner,% upon% registration% of% its%
marked%bottles,%is%vested%by%law%with%an%exclusive%right%to%
use% the% same% to% the% exclusion% of% others,% except% as% a%
container%for%native%products.%A%violation%of%said%right%gives%
rise%to%a%cause%of%action%against%the%violator%or%infringer.%
While% Republic% Act% No.% 623,% as% amended,% provides% for% a%
criminal%action%in%case%of%violation,%a%civil%action%for%damages%
is%proper%under%Article%20%of%the%Civil%Code%which%provides%
that%every%person%who,%contrary%to%law,%wilfully%or%negligently%
causes%damage%to%another,%shall%indemnify%the%latter%for%the%
same.% This% particular% provision% of% the% Civil% Case% was% clearly%
meant% to% complement% all% legal% provisions% which% may% have%
inadvertently%failed%to%provide%for%indemnification%or%reparation%of%
damages%when%proper%or%called%for.%In%the%language%of%the%Code%
Commission% “(t)he% foregoing% rule% pervades% the% entire% legal%
damage% because% another% has% violated% some% legal% provisions,%
should%find%himself%without%relief.”%Moreover,%under%Section%23%of%
Republic% Act% No.% 166,% as% amended,% a% person% entitled% to% the%
exclusive%use%of%a%registered%mark%or%tradeZ%name%may%recover%
%
damages%in%a%civil%action%from%any%person%who%infringes%his%rights.% court% and% ORDERED% to% pay% a% fine% of% One% Thousand% Pesos%
He%may%also,%upon%proper%showing,%be%granted%injunction.% (P1,000.00),%with%costs.%

% SO%ORDERED.%

Even%assuming%that%said%provision%is%applicable%in%this%case,%the%
failure%of%LTI%to%make%said%marking%will%not%bar%civil%action%against%
petitioner%Cagayan.%The%aforesaid%requirement%is%not%a%condition%
sine% qua% non% for% filing% of% a% civil% action% against% the% infringer% for%
other%reliefs%to%which%the%plaintiff%may%be%entitled.%The%failure%to%
give%notice%of%registration%will%not%deprive%the%aggrieved%party%of%a%
cause%of%action%against%the%infringer%but,%at%the%most,%such%failure%
may% bar% recovery% of% damages% but% only% under% the% provisions% of%
Republic%Act%No.%166.%

However,%in%this%case%an%award%of%damages%to%LTI%is%ineluctably%
called%for.%Petitioner%cannot%claim%good%faith.%The%record%shows%
that% it% had% actual% knowledge% that% the% bottles% with% the% blownZin%
marks% “La% Tondeña,% Inc.”% and% “Ginebra% San% Miguel”% are% duly%
registered.%In%Civil%Case%No.%102859%of%the%Court%of%First%Instance%
of% Manila,% entitled% “La% Tondeña,% Inc.% versus% Diego% Lim,% doing%
business%under%the%name%and%style%‘Cagayan%Valley%Distillery,’%”%
a%decision%was%rendered%in%favor%of%plaintiff%therein%on%the%basis%
of%the%admission%and/or%acknowledgment%made%by%the%defendant%
that% the% bottles% marked% only% with% the% words% “La% Tondeña,% Inc.”%
and%“Ginebra%San%Miguel”%are%registered%bottles%of%LTI.%

DISPOSITIVE%PORTION%

WHEREFORE,% judgment% is% hereby% rendered% DENYING% the%

petition%in%this%case%and%AFFIRMING%the%decision%of%respondent%
Court% of% Appeals.% Petitioner% is% hereby% declared% in% contempt% of%
%
DISTILLERIA% WASHINGTON,% INC.% or% WASHINGTON%
DISTILLERY,% INC.,% petitioner% vs.% THE% HONORABLE% COURT%
OF% APPEALS% and% LA% TONDEÑA% DISTILLERS,% INC.,%
respondents"
G.R.%No.%120961.%October%17,%1996%
%
DOCTRINE%
The"statement"in"Section"5"of"R.A."623"to"the"effect"that"the""sale"
of"beverage"contained"in"the"said"containers"shall"not"include"the"
sale"of"the"containers"unless"specifically"so"provided""is"not"a"rule"
of"proscription."It"is"a"rule"of"construction"that,"in"keeping"with"the"
spirit"and"intent"of"the"law,"establishes"at"best"a"presumption"(of"
nonUconveyance"of"the"container)"and"which"by"no"means"can"be"
taken"to"be"either"interdictive"or"conclusive"in"character.%
% appellate% court% reversed% the% court% a" quo% and% ruled% against%
FACTS%
•% The%initiatory%suit%was%for%the%manual%delivery%with%damages%
instituted% by% La% Tondeña% Distillers,% Inc.% (“LTDI”),% against%
Distilleria%Washington%(“Washington”).%LTDI%under%a%claim%of%
ownership,%sought%to%seize%from%Distilleria%Washington%18,157%
empty%“350%c.c.%white%flint%bottles”%bearing%the%blownZin%marks%
of%“La%Tondeña%Inc.”%and%“Ginebra%San%Miguel.”%The%court,%on%
application%of%LTDI,%issued%an%order%of%replevin%for%the%seizure%
of% the% empty% gin% bottles% from% Washington.% These% bottles,% it%
was%averred,%were%being%used%by%Washington%for%its%one%“Gin%
Seven”%products%without%the%consent%of%LTDI.%
%
•% LTDI% asserted% that,% being% the% owner% and% registrant% of% the%
bottles,% it% was% entitled% to% the% protection% so% extended% by%
Republic%Act%("R.A.")%No.%623,%as%amended,%notwithstanding%
its%sale%of%the%Ginebra%San%Miguel%gin%production%contained%in%
said%bottles.%
%
•% Washington% countered% that% R.A.% No.% 623,% invoked% by% LTDI,%
should%not%apply%to%gin,%an%alcoholic%beverage%which%is%unlike%
that% of% "soda% water,% mineral% or% aerated% water,% ciders,% milks,%
cream,%or%other%lawful%beverages"%mentioned%in%the%law,%and%
that,%in%any%case,%ownership%of%the%bottles%should,%considering%
the% attendant% facts% and% circumstances,% be% held% lawfully%
transferred% to% the% buyers% upon% the% sale% of% the% gin% and%
containers%at%a%single%price.%
%
•% The%trial%court%rendered%its%decision%holding%against%LTDI.%The%
Washington.%
%
ISSUE%
Who% has% the% better% right% to% possess% the% 18,% 157% bottles:%
Washington%of%LTDI?%
%
HELD%
Washington%is%not%here%being%charged%with%a%violation%of%Section%
2%of%R.A.%No.%623%or%of%the%Trademark%Law.%The%instant%suit%is%one%
for%replevin%(manual%delivery)%where%the%claimant%must%be%able%to%
show%convincingly%that%he%is%either%the%owner%or%clearly%entitled%to%
the%possession%of%the%object%sought%to%be%recovered.%Replevin%is%
%
a% possessory% action% the% gist% of% which% focuses% on% the% right% of%
possession%that,%in%turn,%is%dependent%on%a%legal%basis%that,%not%
infrequently,% looks% to% the% ownership% of% the% object% sought% to% be%
replevied.%
%
It%is%to%be%pointed%out%that%a%trademark%refers%to%a%word,%name,%
symbol,% emblem,% sign% or% device% or% any% combination% thereof%
adopted%and%used%by%a%merchant%to%identify,%and%distinguish%from%
others,% his% goods% of% commerce.% It% is% basically% an% intellectual%
creation% that% is% susceptible% to% ownership% and,% consistently%
therewith,% gives% rise% to% its% own% elements% of% jus" possidendi," jus"
utendi,"jus"fruendi,"jus"disponendi,"and"jus"abutendi,%along%with%
the%applicable%jus"lex,%comprising%that%ownership.%The%incorporeal%
right,%however,%is%distinct%from%the%property%in%the%material%object%
subject% to% it.% Ownership% in% one% does% not% necessarily% vest%
ownership%in%the%other.%Thus,%the%transfer%or%assignment%of%the%
intellectual%property%will%not%necessarily%constitute%a%conveyance%
of%the%thing%it%covers,%nor%would%a%conveyance%of%the%latter%imply%
the%transfer%or%assignment%of%the%intellectual%right.%
%
Scarcely% disputed% are% certain% and% specific% industry% practices% in%
the% sale% of% gin:% The% manufacturer% sell% the% product% in% marked%
containers,% through% dealers,% to% the% public% in% supermarkets,%
grocery% shops,% retail% stores% and% other% sales% outlets.% The% buyer%
takes% the% item`% he% is% neither% required% to% return% the% bottle% nor%
required%to%make%a%deposit%to%assure%its%return%to%the%seller.%He%
could%return%the%bottle%and%get%a%refund.%A%number%of%bottles%at%
time%find%their%way%to%commercial%users.%It%cannot%be%gainsaid%that%
ownership%of%the%containers%does%pass%on%to%the%consumer%albeit%
subject% to% the% statutory% limitations% on% the% use% of% the% registered%
containers% and% to% the% trademark% rights% of% the% registrant.% The%
statement%in%Section%5%of%R.A.%623%to%the%effect%that%the%"sale%of%
beverage%contained%in%the%said%containers%shall%not%include%the%
sale%of%the%containers%unless%specifically%so%provided"%is%not%a%rule%
of%proscription.%It%is%a%rule%of%construction%that,%in%keeping%with%the%
spirit%and%intent%of%the%law,%establishes%at%best%a%presumption%(of%
nonZconveyance%of%the%container)%and%which%by%no%means%can%be%
taken%to%be%either%interdictive%or%conclusive%in%character.%Upon%the%
other%hand,%LTDI's%sales%invoice,%stipulating%that%the%"sale%does%
not%include%the%bottles%with%the%blownZin%marks%of%ownership%of%La%
Tondeña% Distillers,"% cannot% affect% those% who% are% not% privies%
thereto.%
%
While% it% may% be% unwarranted% then% for% LTDI% to% simply% seize% the%
empty%containers,%this%Court%finds%it%to%be%legally%absurd,%however,%
to%still%allow%petitioner%to%recover%the%possession%thereof.%The%fact%
of%the%matter%is%that%R.A.%623,%as%amended,%in%affording%trademark%
protection% to% the% registrant% has% additionally% expressed% a% prima%
facie%presumption%of%illegal%use%by%a%possessor%whenever%such%
use% or% possession% is% without% the% written% permission% of% the%
registered%manufacturer,%a%provision%that%is%neither%arbitrary%nor%
without% appropriate% rationale.% Indeed,% the% appellate% court% itself%
has%made%a%finding%of%such%unauthorized%use%by%petitioner.%The%
Court%sees%no%other%logical%purpose%for%petitioner's%insistence%to%
keep%the%bottles,%except%for%such%continued%use.%The%practical%and%
feasible% alternative% is% to% merely% require% the% payment% of% just%
compensation%to%petitioner%for%the%bottles%seized%from%it%by%LTDI.%
Conventional% wisdom,% along% with% equity% and% justice% to% both%
parties,%dictates%it.%
%
%
Washington%has%the%better%right.%Washington%is%the%owner%of%the%
bottles.% But% since% LTDI% already% seized% the% bottles,% LTDI% was%
ordered% to% pay% Washington% just% compensation% for% the% seized%
bottle.%%
Distilleria%Washington%v.%La%Tondeña% a%single%price%for%the%liquor%and%the%bottle%and%is%not%required%
G.R.%No.%120961,%2%October%1997% to%return%the%bottle%at%any%time.%
Ponente:%Kapunan,%J.% •% The%CA%reversed%the%trial%court’s%decision,%ruling%that%under%
% Republic%Act%623,%the%use%of%marked%bottles%by%any%person%
DOCTRINE% other%than%the%manufacturer,%bottler%or%seller,%without%the%
Sections%2%an%d%3%of%RA%623%apply%only%when%the%“filling%up”%o%f% latter’s%written%consent,%is%unlawful.%
the%bottle%or%the%“use”%of%the%bottle%is%“without%the%permission”%of% •% The%SC%affirmed%the%CA’s%decision%with%modification,%
the%registered%manufacturer,%bottler%or%seller”,%who%has% implicitly%acknowledging%that%there%was%a%valid%transfer%of%the%
registered%the%marks%of%ownership%of%the%bottles.%Section%2% bottles%to%Distilleria%Washington,%except%that%its%possession%
prohibits%the%person%from%using,%selling%or%otherwise%disposing%of% of%the%bottles%without%the%written%consent%of%La%Tondeña%
registered%containers%without%the%written%consent%of%the% gives%rise%to%a%prima%facie%presumption%of%illegal%use%under%
registrant.%Such%rights%belong%to%the%registrant.%Under%Section%3,% R.A.%623.%
mere%possession%of%such%registered%containers%without%written% •% Washington%sought%reconsideration%of%the%decision%of%the%SC%
consent%of%the%registrant%is%prima%facie%presumed%unlawful.%% and%advances%that%since%the%court%decided%that%Washington%
% has%acquired%ownership%over%the%bottles,%it%is%improper%for%it%
What%is%proscribed%is%the%use%of%the%bottles%in%infringement%of% to%render%a%decision%allowing%La%Tondeña%to%keep%the%bottles%
another’s%trademark%or%incorporeal%rights.%% (which%is%a%denial%of%the%very%attributes%of%ownership).%It%
% further%contends%that%to%hold%the%buyer%liable%under%Section%2%
% and%3%of%R.A.%623%would%grant%La%Tondeña%the%extraordinary%
FACTS% right%not%only%of%possession%and%use%of%the%bottles%which%it%
•% Respondent%La%Tondeña%filed%before%the%RTC%for%the% has%sold%and%no%longer%owns,%but%also%to%sell%said%bottles%ad%
recovery,%under%its%claim%of%ownership,%of%possession%or% infinitum,%thus%enriching%itself%unjustly.%%
replevin%against%petitioner%Distilleria%Washington,%Inc.% %
(Washington)%of%18,157%empty%“350%c.c.%white%flint%bottles”% ISSUE%
bearing%the%blownZin%marks%of%“La%Tondeña,%Inc.”%and% Did%La%Tondeña%Distillers,%Inc.%transfer%ownership%of%its%marked%
“Ginebra%San%Miguel,”%averring%that%Distilleria%Washington% bottles%or%containers%when%it%sold%its%products%in%the%market?%
was%using%the%bottles%for%its%own%“Gin%Seven”%products% %
without%the%consent%of%Distilleria%Washington%in%violation%of% HELD%
Republic%Act%623.% HELL%YES!%La%Tondeña%not%only%sold%its%gin%products%but%also%
•% RTC%dismissed%the%complaint,%upholding%Distilleria% the%marked%bottles%or%containers%as%well.%Ownership%over%the%
Washington’s%contention%that%a%purchaser%of%liquor%pays%only% bottles%and%all%its%attributes%passed%to%the%buyer.%It%necessarily%
follows%that%the%transferee%has%the%right%to%possession%of%the%
bottles%unless%he%uses%them%in%violation%of%the%original%owner’s%
registered%or%incorporeal%rights.%%
%
Sections%2%and%3%of%R.A.%623%apply%only%when%the%“filling%up”%of%
the%bottle%or%the%“use”%of%the%bottle%is%“without%the%permission”%of%
the%registered%manufacturer,%bottler%or%seller”,%who%has%
registered%the%marks%of%ownership%of%the%bottles.%Section%2%
prohibits%the%person%from%using,%selling%or%otherwise%disposing%of%
registered%containers%without%the%written%consent%of%the%
registrant.%Such%rights%belong%to%the%registrant.%Under%Section%3,%
mere%possession%of%such%registered%containers%without%written%
consent%of%the%registrant%is%prima%facie%presumed%unlawful.%
Since%the%court%found%that%the%bottles%have%been%transferred%by%
way%of%sale,%then%La%Tondeña%relinquished%all%of%its%proprietary%
rights%over%the%bottles%in%favor%of%Washington%who%has%obtained%
them%in%due%course.%%
%
The%court,%however,%did%not%rule%on%the%violation%of%the%
incorporeal%rights%of%La%Tondeña%since%it%would%be%improper%and%
premature%to%rule%on%such%point.%It%has%not%been%put%in%issue%
since%this%was%a%case%for%replevin,%not%infringement.%%
%
The%court%also%cannot%be%of%the%position%that%every%possession%
of%the%bottles%without%the%requisite%written%consent%is%illegal%since%
then,%thousands%of%buyers%of%the%Ginebra%San%Miguel%would%be%
exposed%to%criminal%prosecution%by%the%mere%fact%of%possession%
of%the%empty%bottles%after%consuming%the%content.%%
%
188.% TWIN% ACE% HOLDINGS% CORPORATION% v.% COURT% OF%
APPEALS%and%LORENZANA%FOOD%CORPORATION%
GR%No.%123248,%October%16,%1997%
FACTS:%%
•% TWIN% ACE% is% a% manufacturer,% distiller% and% bottler% of%
distillery%products%under%the%name%and%style%of%TANDUAY.%
LORENZANA%manufactures%and%exports%processed%foods%
and%other%related%products%and%other%food%seasonings.%
•% TWIN% ACE% filed% a% complaint% for% replevin% to% recover%
380,000% bottles% allegedly% owned% by% it% but% detained% and%
used% by% LORENZANA% as% containers% for% native% products%
without%express%permission,%in%violation%RA%No.%623.%And%
even%if%the%law%can%be%applied,%the%right%of%LORENZANA%
to% use% the% bottles% as% containers% for% its% patis% and% other%
native%products%were%sanctioned%under%sec.%6%of%the%said%
law.%
•% LORENZANA% moved% to% dismiss% the% complaint% on% the%
ground% that% RA% No.% 623% could% not% be% invoked% by% TWIN%
ACE% because% the% law% contemplated% containers% of% nonZ
alcoholic%beverages%only.%
•% RTC% dismissed% the% complaint.% CA% affirmed% stating% that%
while%bottles%and%containers%of%alcoholic%beverages%were%
covered%under%RA%No.%623,%the%said%bottles%were%used%as%
containers%for%native%products%(sisi,%bagoong,%patis)%which%
was%allowed%by%the%law.%
ISSUE:% 1.% WON% the% registered% containers% of% hard% liquor% are%
protected%by%RA%No.%623?%
2.%WON%LORENZANA%is%obliged%to%pay%just%compensation%for%the%
use%of%the%subject%bottles?%
HELD:%1.%No.%It%is%quite%clear%that%LORENZANA%falls%within%the%
exemption% granted% in% Sec.% 6% of% the% Act% which% states:% "The"
provisions"of"this"Act"shall"not"be"interpreted"as"prohibiting"the"
use" of" bottles" as" containers" for" "sisi,"" "bagoong,"" "patis,"" and"
similar"native"products."%
DOCTRINE:%Republic%Act%No.%623,%"An"Act"to"Regulate"the"Use"
of"Duly"Stamped"or"Marked"Bottles,"Boxes,"Casks,"Kegs,"Barrels"
and"Other"Similar"Containers,"%as%amended%by%RA%No.%5700,%was%
meant%to%protect%the%intellectual%property%rights%of%the%registrants%
of%the%containers%and%prevent%unfair%trade%practices%and%fraud%on%
the%public.%However,%the%exemption%granted%in%Sec.%6%thereof%was%
deemed%extremely%necessary%to%provide%assistance%and%incentive%
to% the% backyard,% cottage% and% smallZscale% manufacturers% of%
indigenous%native%products%such%as%patis,"sisi%and%toyo%who%do%
not%have%the%capital%to%buy%brand%new%bottles%as%containers%nor%
afford%to%pass%the%added%cost%to%the%majority%of%poor%Filipinos%who%
use%the%products%as%their%daily%condiments%or%viands.%
Since%the%purchaser%at%his%discretion%could%either%retain%or%return%
the% bottles,% the% transaction% must% be% regarded% as% a% sale% of% the%
bottles%when%the%purchaser%actually%exercised%that%discretion%and%
decided%not%to%return%them%to%the%vendor.%
2.%No.%Obviously,%the%contention%of%TWIN%ACE%that%the%exemption%
refers% only% to% criminal% liability% but% not% to% civil% liability% is% without%
merit.%It%is%inconceivable%that%an%act%specifically%allowed%by%law,%in%
other% words% legal,% can% be% the% subject% of% injunctive% relief% and%
damages.%Besides,%the%interpretation%offered%by%petitioner%defeats%
the%very%purpose%for%which%the%exemption%was%provided.%
$
ARNEL%U.%TY,%MARIE%ANTONETTE%TY,%JASON%ONG,%WILLY%
DY,% and% ALVIN% TY,% petitioners% (DIRECTORS% OF% OMNI%
CORPORATION)%
vs.%%
NBI% SUPERVISING% AGENT% MARVIN% E.% DE% JEMIL,% PETRON%
GASUL%DEALERS%ASSOCIATION,%and%TOTALGAZ%DEALERS%
ASSOCIATION,%respondents%
% 7.% Several% used% branded% cylinders(1)% were% searched% and%
Doctrine:%
Evidently,%this%pernicious%practice%of%tampering%or%changing%the%
appearance%of%a%branded%LPG%cylinder%to%look%like%another%brand%
violates%the%brand%owners’%property%rights%as%infringement%under%
Sec.%155.1%of%RA%8293%
Facts:%
1.% Private%respondents,%through%their%law%firm,%requested%the%
NBI% to% investigate% the% alleged% practice% of% OMNI%
Corporation% of% refilling% the% former's% used% branded% LPG%
Cylinders% without% their% consent% and% tampering% the%
appearance% thereof% to% make% it% appear% as% if% it% were% the%
latter's.%
2.% Petitioners%are%stockholders/directors%of%OMNI`%Arnel%Uy%is%
the%President%
1 Quantity/Unit Description
7 LPG cylinders Totalgaz, 11.0 kg [filled]
1 LPG cylinder Petron Gasul, 11.0 kg [filled]
1 LPG cylinder Shellane, 11.0 kg [filled]
29 LPG cylinders Superkalan Gaz, 2.7 kg [empty]
17 LPG cylinders Petron Gasul, 11.0 kg [emptly]
8 LPG cylinders Marked as Omnigas with Shell emboss,
11.0 kg [empty]
3.% Omni%is%in%the%business%of%trading%and%refilling%of%Liquefied%
Petroleum%Gas%(LPG)%cylinders%and%
4.% The%NBI,%conducted%a%testZbuy%operation,%wherein%agents%
brought%used%cylinders%of%private%respondents%to%OMNI%for%
refilling.%
5.% After%paying%the%amount%of%PhP%1,582,%OMNI%refilled%the%
used%cylinders.%
6.% Thus,%finding%probable%cause,%the%NBI%applied%for%search%
warrant%before%the%RTC%and%was%granted%
seized.%
8.% Petitioners% contend% that% there% is% no% probable% cause% to%
believe%that%they%infringed%BP%33%
9.% I%skipped%the%procedural%issues`%basically,%the%Office%of%the%
Chief% State% Prosecutor% found% probable% cause% and%
recommended%the%filing%of%two%informations%for%violation%of%
BP33,% which% was% reversed% by% the% DOJ% Secretary,% and%
against%reversed%by%the%CA%%
ISSUE:%%
1.% WON% Omni% corporation's% act% of% refilling% a% branded% LPG%
cylinder% without% the% written% consent% of% the% brand% owners%
constitutes%a%probable%violation%under%BP33%Z%YES%
%
5 LPG cylinders Marked as Omnigas with Totalgaz emboss,
11.0 kg [empty]
23 LPG cylinders Shellane, 11.0 kg [empty]
3 LPG cylinders Marked as Omnigas with Gasul emboss,
11.0 kg [empty]
21 LPG cylinders Totalgaz, 11.0 kg [empty]
$
$
2.% WON% the% practice% of% tampering% or% changing% the% First.%The%testZbuy%conducted%on%April%15,%2004%by%the%NBI%
appearance%of%a%branded%LPG%cylinder%to%look%like%another% agents,%as%attested%to%by%their%respective%affidavits,%tends%to%show%
br%and%constitutes%infringement%under%the%IP%Code%ZYES% that% Omni% illegally% refilled% the% eight% branded% LPG% cylinders% for%
PhP% 1,582.% This% is% a% clear% violation% of% Sec.% 2% (a),% in% relation% to%
%
Secs.%3%(c)%and%4%of%BP%33,%as%amended.%It%must%be%noted%that%the%
Held:% criminal%complaints,%as%clearly%shown%in%the%complaintZaffidavits%
of% Agent% De% Jemil,% are% not% based% solely% on% the% seized% items%
1.% Yes.% Sec.% 2% (a)% in% relation% to% Sec.% 3% (c)% of% BP% 33,% as% pursuant%to%the%search%warrants%but%also%on%the%testZbuy%earlier%
amended.%Said%provisos%provide:% conducted%by%the%NBI%agents.%
%% %%
Sec.% 2.% % % % Prohibited% Acts.The% following% acts% are% Second.% The% written% certifications% from% Pilipinas% Shell,%
prohibited%and%penalized:% Petron%and%Total%show%that%Omni%has%no%written%authority%to%refill%
% LPG%cylinders,%embossed,%marked%or%stamped%Shellane,%Petron"
(a)% % % % Illegal% trading% in% petroleum% and/or% Gasul,%Totalgaz%and%Superkalan"Gaz.%In%fact,%petitioners%neither%
petroleum%products`% dispute% this% nor% claim% that% Omni% has% authority% to% refill% these%
%% branded%LPG%cylinders.%
x%x%x%x% %%
%% Third.% Belying% petitioners% contention,% the% seized% items%
Sec.%3.%%%%Definition%of%terms.For%the%purpose%of%this% during%the%service%of%the%search%warrants%tend%to%show%that%Omni%
Act,%the%following%terms%shall%be%construed%to%mean:% illegally%refilled%branded%LPG%cylinders%without%authority.%
% %%
Illegal% trading% in% petroleum% and/or% petroleum% On%April%29,%2004,%the%NBI%agents%who%served%the%search%
products% warrants%on%Omni%seized%the%following:%
% %
x%x%x%x% (SEE%FIRST%FOOTNOTE)%%
% %%
(c)% Refilling% of% liquefied% petroleum% gas% The% foregoing% list% is% embodied% in% the% NBIs%
cylinders% without% authority% from% said% Bureau,% or% Receipt/Inventory%of%Property/Item%Seized%signed%by%NBI%Agent%
refilling%of%another%companys%or%firms%cylinders% Edwin% J.% Roble% who% served% and% implemented% the% search%
without% such% companys% or% firms% written% warrants.%And%a%copy%thereof%was%duly%received%by%Atty.%Allan%U.%
authorization`%(Emphasis%supplied.)% Ty,%representative%of%Omni,%who%signed%the%same%under%protest%
% and%made%the%annotation%at%the%bottom%part%thereon:%The%above%
$
items/cylinders% were% taken% at% customers% trucks% and% the% empty%
cylinders% taken% at% the% warehouse% (swapping% section)% of% the%
company.%%
%%
Even%considering%that%the%filled%LPG%cylinders%were%indeed%
already% loaded% on% customers% trucks% when% confiscated,% yet% the%
fact%that%these%refilled%LPG%cylinders%consisting%of%nine%branded%
LPG%cylinders,%specifically%Totalgaz,%Petron"Gasul%and%Shellane,%
tends% to% show% that% Omni% indeed% refilled% these% branded% LPG%
cylinders% without% authorization% from% Total,% Petron% and% Pilipinas%
Shell.%Such%a%fact%is%bolstered%by%the%testZbuy%conducted%by%Agent%
De% Jemil% and% NBI% confidential% agent% Kawada:% Omnis%
unauthorized%refilling%of%branded%LPG%cylinders,%contrary%to%Sec.%
2%(a)%in%relation%to%Sec.%3%(c)%of%BP%33,%as%amended%
% DOE:%brand%owners%are%deemed%owners%of%their%duly%embossed,%
% stamped%and%marked%LPG%cylinders%even%if%these%are%possessed%
2.% Yes.% Among% those% seized% by% the% NBI% are% 16% LPG% cylinders%
bearing% the% embossed% brand% names% of% Shellane,% Gasul% and%
Totalgaz%but%were%marked%as%Omnigas.%Evidently,%this%pernicious%
practice%of%tampering%or%changing%the%appearance%of%a%branded%
LPG%cylinder%to%look%like%another%brand%violates%the%brand%owners’%
property% rights% as% infringement% under% Sec.% 155.1% of% RA% 8293.%
Moreover,%tampering%of%LPG%cylinders%is%a%mode%of%perpetrating%
the% criminal% offenses% under% BP% 33,% as% amended,% and% clearly%
enunciated%under%DOE%Circular%No.%2000Z06Z010%which%provided%
penalties%on%a%per%cylinder%basis%for%each%violation.%
BP%33,%as%amended,%does%not%require%ownership%of%the%branded%
LPG%cylinders%as%a%condition%sine%qua%non%for%the%commission%of%
offenses%involving%petroleum%and%petroleum%products.%Verily,%the%
offense% of% refilling% a% branded% LPG% cylinder% without% the% written%
consent%of%the%brand%owner%constitutes%the%offense%regardless%of%
the%buyer%or%possessor%of%the%branded%LPG%cylinder.%
After%all,%once%a%consumer%buys%a%branded%LPG%cylinder%from%the%
brand%owner%or%its%authorized%dealer,%said%consumer%is%practically%
free%to%do%what%he%pleases%with%the%branded%LPG%cylinder.%He%can%
simply%store%the%cylinder%once%it%is%empty%or%he%can%even%destroy%
it%since%he%has%paid%a%deposit%for%it%which%answers%for%the%loss%or%
cost%of%the%empty%branded%LPG%cylinder.%Given%such%fact,%what%
the% law% manifestly% prohibits% is% the% refilling% of% a% branded% LPG%
cylinder%by%a%refiller%who%has%no%written%authority%from%the%brand%
owner.%Apropos,%a%refiller%cannot%and%ought%not%to%refill%branded%
LPG%cylinders%if%it%has%no%written%authority%from%the%brand%owner.%
Besides,%persuasive%are%the%opinions%and%pronouncements%by%the%
by% customers% or% consumers.% The% Court% recognizes% this% right%
pursuant% to% our% laws,% i.e.,% Intellectual% Property% Code% of% the%
Philippines.%Thus%the%issuance%by%the%DOE%Circular%No.%2000Z05Z
007,[61]% the% letterZopinion[62]% dated% December% 9,% 2004% of% then%
DOE%Secretary%Vincent%S.%Perez%addressed%to%Pilipinas%Shell,%the%
June% 6,% 2007% letter[63]% of% then% DOE% Secretary% Raphael% P.M.%
Lotilla%to%the%LPGIA,%and%DOE%Department%Circular%No.%2007Z10Z
0007[64]% on% LPG% Cylinder% Ownership% and% Obligations% Related%
Thereto%issued%on%October%13,%2007%by%DOE%Secretary%Angelo%T.%
Reyes.%
%
WHEREFORE,% premises% considered,%
we% PARTIALLY% GRANT% the% instant% petition.% Accordingly,% the%
assailed% September% 28,% 2007% Decision% and% March% 14,% 2008%
$
Resolution% of% the% Court% of% Appeals% in% CAZG.R.% SP% No.% 98054%
are% AFFIRMED% with% MODIFICATION% that% petitioners% Mari%
Antonette% Ty,% Jason% Ong,% Willy% Dy% and% Alvin% Ty% are% excluded%
from%the%two%Informations%charging%probable%violations%of%Batas%
Pambansa% Bilang% 33,% as% amended.% The% Joint% Resolution%
dated% November% 7,% 2005% of% the% Office% of% the% Chief% State%
Prosecutor%is%modified%accordingly.%
%

NOTE:%Respondents%won`%the%petition%was%partially%granted%only%
with%respect%to%petitioners,%except%ARNEL%UY,%because%they%are%
merely%directors%of%the%corporation.%Arnel%Uy%is%liable%because%he%
is%the%President.%
$
% •% In%the%surveillance%conducted%by%NBI,%REGASCO%was%
revealed%to%be%engaged%in%the%unlawfully%refilling%the%sale%
Republic% Gas% Corporation,% Arnel% Ty,% et% al.,% v.% Petron%
of%LPG%cylinders%bearing%the%marks%and%trademarks%
Corporation,% Pilipinas% Shell% Petroleum% Corporation% and%
owned%by%Petron%and%Shell.%%
Shell%International%Petroleum%Company%Limited%
•% NBI%lodged%complaint%for%violation%of%Sec.%155%and%168,%
G.R.%No.%194062,%17%June%2013% IPC.%
•% Prosecutor%dismissed%the%complaint,%affirmed%by%
Ponente:%J.%Peralta% Secretary%of%DoJ.%%
% •% Respondents%filed%petition%for%certiorari%with%CA.%
•% CA%granted%the%petition,%reversed%DOJ.%%%
FACTS% %

•% REGASCO%was%engaged%in%the%refilling%and%distribution% ISSUE%
of%LPG%cylinders.%
•% PETRON%is%the%owner%of%the%tradename%GASUL,%LPG% WON% Republic% Gas% Corporation% committed% trademark%
infringement%and%unfair%competition%
cylinder%
•% SHELL%is%the%owner%of%SHELLANE%tradename,%LPG% HELD%
cylinder%
•% Petron%and%Shell%are%two%of%the%largest%bulk%suppliers%and% YES.%
producers%of%liquefied%petroleum%gas%(LPG)%in%the%
•% Jurisprudence%provides%that%the%mere%unauthorized%use%
Philippines.%%
of%a%container%bearing%a%registered%trademark%in%
•% LPG%Dealers’%Association%sent%reports%to%SHELL%and%
connection%with%the%sale,%distribution%or%advertising%of%
Petron%that%there%were%certain%entities%who%were%engaged%
good%or%services%which%is%likely%to%cause,%confusion,%
in%the%unauthorized%refilling,%sale%and%distribution%of%LPG%
mistake%or%deception%among%buyers%or%consumers%can%be%
cylinders,%bearing%their%respective%LPG%cylinder%
considered%as%trademark%infringement.%
tradenames.%%
•% REGASCO%committed%trademark%infringement%when%the%
•% SHELL%and%Petron%filed%with%the%NBI%for%an%investigation%
refilled%the%containers%without%the%respondents’%consent.%
on%the%alleged%illegal%trading%of%petroleum%products.%
The%said%containers%bear%the%registered%marks%of%the%
•% NBI%conducted%an%investigation%on%several%persons%and% respondents.%%
establishments%suspected%to%be%engaged%in%the%
•% REGASCO’s%acts%will%inevitably%confuse%the%consuming%
unauthorized%acts.%
public.%The%public%will%then%be%led%to%believe%that%
$
petitioners%are%authorized%refillers%and%distributors%of%
respondents’%LPG%products,%considering%that%they%are%
accepting%empty%containers%of%respondents%and%refilling%
them%for%resale.%
•% From%jurisprudence,%unfair%competition%has%been%defined%
as%the%passing%off%(or%palming%off)%or%attempting%to%pass%
off%upon%the%public%of%the%goods%or%business%of%one%
person%as%the%goods%or%business%of%another%with%the%end%
and%probable%effect%of%deceiving%the%public.%
•% In%this%case,%REGASCO%was%refilling%and%selling%LPG%
cylinders%bearing%respondents’%marks.%In%effect,%
REGASCO%was%selling%goods%by%giving%them%the%general%
appearance%of%goods%of%another%manufacturer.%%
•% In%addition,%the%consumers%may%be%misled%into%believing%
that%the%LPGs%contained%in%the%cylinders%bearing%the%
marks%“GASUL”%and%“SHELLAINE”%are%goods%of%
REGASCO,%when%in%fact%they%are%not.%%
•% There%is%sufficient%evidence%to%warrant%prosecution%of%
REGASCO%for%trademark%infringement%and%unfair%
competition.%%
•% Petition%DENIED,%CA%is%AFFIRMED.%%%
%
$
192.% DEL% MONTE% CORP.% and% PHIL.% PACKING% CORP.% v.%
COURT% OF% APPEALS% and% SUNSHINE% SAUCE% MFG.%
INDUSTRIES%
GR%No.%L>78325,%January%25,%1990%
FACTS:%%
•% Del% Monte% (DM)% is% a% foreign% corporation% under% US% laws%
and% not% engaged% in% business% in% the% Phils.% Phil.% Packing%
Corp.%(PPC)%a%domestic%corporation.%
•% In% 1969,% DM% granted% PPC% the% right% to% manufacture,%
distribute%and%sell%in%the%Phils.%various%agricultural%products%
including%catsup%under%the%DM%trademark%and%logo.%
•% In%1965,%DM%authorized%PPC%to%register%with%the%PPO%the%
DM%catsup%bottle%configuration%which%was%granted.%
•% In%1972,%DM%also%obtained%two%registration%certificates%for%
its%trademark%“Del%Monte”%and%its%logo.%
•% In% 1980,% Sunshine% Sauce% Mfg.% (SSM)% was% issued% a%
certificate% of% registration% to% engage% in% the% manufacture,%
1.%As%to%the%shape%of%label%or%make:%
Del%Monte:%SemiZrectangular%with%a%crown%or%tomato%shape%
design%on%top%of%the%rectangle.%
Sunshine:%Regular%rectangle.%
% Del%Monte:%In%the%shape%of%a%tomato.%
2.%As%to%brand%printed%on%label:%
Del%Monte:%Tomato%catsup%mark.%
Sunshine:%Fruit%catsup.%
% Del%Monte:%Seal%covering%the%cap%down%to%the%neck%of%the%bottle,%
4.%As%to%color%of%logo:%
Del%Monte:%Combination%of%yellow%and%dark%red,%with%words%"Del%
Monte%Quality"%in%white.%
packing%and%distribution%and%sale%of%various%kinds%of%sauce%
identified%by%the%logo%“Sunshine%Fruit%Catsup”,%which%was%
registered%in%1983.%
•% The% SSM% product% was% contained% in% various% bottles%
including%the%DM%bottle%which%SSM%bought%from%the%junk%
shops%for%recycling.%
•% PPC% and% DM% filed% a% complaint% against% SSM% for%
infringement%of%trademark%and%unfair%competition.%
•% SSM%alleged%that%it%had%long%ceased%to%use%the%DM%bottle%
and%that%its%logo%was%substantially%different%from%DM’s.%
•% RTC% dismissed% the% complaint% stating% that% there% were%
substantial%differences%between%the%logos%or%trademarks%of%
the%parties%and%that%PPC%and%DM%failed%to%establish%SSM’s%
malice% or% bad% faith% which% was% an% essential% element% of%
infringement.%
•% CA%affirmed.%
NOTE%(just%in%case):%Comparison%made%by%the%SC
Sunshine:%White,%light%green%and%light%red,%with%words%"Sunshine%
Brand"%in%yellow.%
%
5.%As%to%shape%of%logo:%
Sunshine:%Entirely%different%in%shape.%
%
6.%As%to%label%below%the%cap:%
with%picture%of%tomatoes%with%words%"made%from%real%tomatoes."%
Sunshine:%There%is%a%label%below%the%cap%which%says%"Sunshine%
Brand."%
%
$
7.%As%to%the%color%of%the%products:%
Del%Monte:%Darker%red.%
ISSUE:%WON%there%was%infringement%on%the%trademark%and%unfair%
competition%
HELD:%Yes%(to%infringement%and%unfair%competition).%SideZbyZside%
comparison%is%not%the%final%test%of%similarity.%The%question%is%not%
whether%the%two%articles%are%distinguishable%by%their%label%when%
set%side%by%side%but%whether%the%general%confusion%made%by%the%
article%upon%the%eye%of%the%casual%purchaser%who%is%unsuspicious%
and%off%his%guard,%is%such%as%to%likely%result%in%his%confounding%it%
with%the%original.%
To%determine%whether%a%trademark%has%been%infringed,%the%mark%
must%be%considered%as%a%whole%and%not%as%dissected.%If%the%buyer%
is%deceived,%it%is%attributable%to%the%marks%as%a%totality,%not%usually%
to%any%part%of%it.%%%
As% Sunshine's% label% is% an% infringement% of% the% Del% Monte's%
trademark,%law%and%equity%call%for%the%cancellation%of%the%private%
respondent's% registration% and% withdrawal% of% all% its% products%
Sunshine:%Lighter%than%Del%Monte.%
bearing%the%questioned%label%from%the%market.%With%regard%to%the%
use% of% Del% Monte's% bottle,% the% same% constitutes% unfair%
competition`% hence,% the% respondent% should% be% permanently%
enjoined%from%the%use%of%such%bottles.%
DOCTRINE:%Distinctions%between%infringement%of%trademark%
and%unfair%competition.%
(1)%Infringement%of%trademark%is%the%unauthorized%use%of%a%
trademark,%whereas%unfair%competition%is%the%passing%off%of%
one's%goods%as%those%of%another.%
(2)%In%infringement%of%trademark%fraudulent%intent%is%unnecessary%
whereas%in%unfair%competition%fraudulent%intent%is%essential.%
(3)%In%infringement%of%trademark%the%prior%registration%of%the%
trademark%is%a%prerequisite%to%the%action,%whereas%in%unfair%
competition%registration%is%not%necessary.%%
$
Pro%Line%Sports%v.%CA% 5.% Sehwani% admitted% to% having% manufactured% “Spalding”%
basketballs% and% volleyballs,% he% nevertheless% stressed% that% this%
G.R.%No.%118192.%October%23,%1997% was% only% for% the% purpose% of% complying% with% the% requirement% of%
Difference%between%infringement%and%unfair%competition% trademark%registration%with%the%Philippine%Patent%Office.%
%
DOCTRINE% 6.% Sehwani% stressed% that% in% order% for% there% to% be% Unfair%
Competition%there%must%be%selling%of%the%Products.%
That%a%corporation%other%than%the%certified%owner%of%the%trademark%
%
is%engaged%in%the%unauthorized%manufacture%of%products%bearing%
ISSUE:% WON% there% was% probable% cause% in% the% filing% of% the%
the% same% trademark% engenders% a% reasonable% belief% that% a%
complaint%for%Unfair%Competition.%–%YES%
criminal%offense%for%unfair%competition%is%being%committed.%
%WON% Petitioner% is% liable% for% damages% because% of% malicious%
%
prosecution.%Z%NO%
FACTS% %
HELD%
1.% QUESTOR,% US% Company,% owner% of% the% trade% mark% for% 1.% Nevertheless% stressed% that% this% was% only% for% the% purpose% of%
“Spalding”.% PRO% LINE,% Ph% corp.,% the% exclusive% distributor% of% complying%with%the%requirement%of%trademark%registration%with%the%
“Spalding”%in%the%Ph." Philippine%Patent%Office.%
% %
2.%Monico%Sehwani,%president%of%Universal%Athletics%and%Industrial% 2.% The% affidavit% of% Graciano% Lacanaria,% a% former% employee% of%
Products,%Inc.%(UNIVERSAL).% UNIVERSAL,% attesting% to% the% illegal% sale% and% manufacture% of%
% “Spalding”%balls%and%seized%“Spalding”%products%and%instruments%
3.% Questor% and% Pro% Line% filed% a% criminal% case% for% unfair% from%UNIVERSAL’s%factory%was%sufficient%prima!facie!evidence%
competition% against% Sehwani% for% allegedly% manufacturing% fake% to%warrant%the%prosecution%of%private%respondents.%
Spalding%balls.%The%case%was%dismissed.% %
% 3.% That% a% corporation% other% than% the% certified% owner% of% the%
4.%As%a%retaliatory%move,%Sehwani%and%UNIVERSAL%filed%a%civil% trademark% is% engaged% in% the% unauthorized% manufacture% of%
case%for%damages%against%PRO%LINE%and%QUESTOR%for%what% products% bearing% the% same% trademark% engenders% a% reasonable%
they%perceived%as%the%wrongful%and%malicious%filing%of%the%criminal% belief% that% a% criminal% offense% for% unfair% competition% is% being%
action% for% unfair% competition% against% them.% In% short,% Sehwani% is% committed.%
alleging%malicious%prosecution.% %
% 4.%To%hold%that%the%act%of%selling%is%an%indispensable%element%of%
the% crime% of% unfair% competition% is% illogical% because% if% the% law%
$
punishes% the% seller% of% imitation% goods,% then% with% more% reason%
should%the%law%penalize%the%manufacturer.%
%
6.%There%is%no%proof%that%petitioner%was%driven%by%any%ilZmotive%in%
filing%the%criminal%complaint%for%Unfair%Competition.%
%
5.% Therefore,% Petitioner% is% NOT% liable% for% damages% because% of%
Malicious%Prosecution.%
$
Universal%Rubber%Products%Inc.%vs.%CA%
Doctrine:%General%rule:%complainant%is%entitled%to%an%accounting%
and%recovery%of%defendant's%profits%on%the%goods%sold%under%that%
mark,%as%incident%to,%and%a%part%of,%his%property%right,%and%this%rule%
applies%in%cases%of%unfair%competition.%%
In% order% to% entitle% a% party% to% the% issuance% of% a%
"subpoena" duces" tecum% ",% it% must% appear,% by% clear% and%
unequivocal% proof,% that% the% book% or% document% sought% to% be%
produced%contains%evidence%relevant%and%material%to%the%issue%
before%the%court,%and%that%the%precise%book,%paper%or%document%
containing%such%evidence%has%been%so%designated%or%described%
that%it%may%be%identified.%%%
Facts:%
•% Respondent% corporations% herein% sued% the% present%
petitioner% for% unfair% competition% with% damages% and%
attorney's%fees.%%
•% Thereafter,%they%made%a%request%to%the%respondent%Judge%
to%issue%a%subpoena%duces"tecum"against%the%treasurer%of%
herein% petitioner.% Respondent% Judge% issued% a%
subpoena%duces"tecum%directing%the%treasurer%to%bring%"all%
sales% invoices,% sales% books% and% ledgers% wherein% are%
recorded%the%sales%of%Plymouth%Star%Player%rubber%shoes%
from% the% time% the% corporation% started% manufacturing% and%
selling%said%shoes%up%to%the%present.”%
•% Petitioner%filed%a%motion%to%quash%subpoena%duces"tecum%
but% was% denied% by% the% court.% Petitioner’s% motion% for%
reconsideration%was%likewise%denied%hence%petitioner%filed%
present% petition% for% certiorari% with% preliminary% injunction,%
alleging%that%respondent%Judge%acted%with%grave%abuse%of%
discretion%amounting%to%an%excess%of%jurisdiction.%%
•% Pending% the% resolution% of% the% appealed% case,% the% CA%
issued%a%TRO%directing%the%respondent%Judge%of%the%trial%
court%to%refrain%from%implementing%his%order.%
•% Subsequently,% the% CA% rendered% its% decision% denying% the%
petition%for%certiorari%filed%by%petitioner%for%lack%of%merit.%%
Private% respondent:% (1)% the% subpoena% duces" tecum% in% question%
specifically% designates% the% books% and% documents% that%
should% be% produced% in% court% and% they% are% 4% sales% invoices,%
sales% books% and% ledgers% where% are% recorded% the% sales% of%
Plymouth%Star%Player%Rubber%Shoes%from%the%time%the%corporation%
started% manufacturing% and% selling% shoes% (that% is% from% April% 1,%
1963)%up%to%the%present`%and%(2)%books%are%relevant%because%if%
and% when% herein% respondent% corporations% are% ultimately%
adjudged%to%be%entitled%to%recover%compensatory%damages%from%
the%petitioner,%it%would%be%the%factual%basis%for%the%amount%of%
such%damages.%
%
Issue:%whether%the%issuance%of%the%"subpoena%duces"tecum"%is%
proper%in%a%suit%for%unfair%competition?%
Held:%YES%In%a%suit%for%unfair%competition,%it%is%only%through%the%
issuance% of% the% questioned% "subpoena% duces" tecum" "% that% the%
complaining% party% is% afforded% his% full% rights% of% redress.% (See%
Doctrine)%
The%sufficiency%in%the%description%of%the%books%sought%to%
be%produced%in%court%by%the%questioned%"subpoena%duces%tecum%
is%not%disputed%in%this%case%(see%respondent’s%argument),%hence,%
$
We% hold% that% the% same% has% passed% the% test% of% sufficient%
description.%
% business% which% it% has% transacted% in% the% Philippine%
Petitioner’s%arguments:%%
1.% There"should"first"be"found"guilty"unfair"competition"before"
an"accounting"for"purposes"of"ascertaining"the"amount"of"
damages"recoverable"can"proceed%–%no%merit.%Complaint%
for%unfair%competition%is%basically%a%suit%for%"injunction%and%
damages".% Injunction,% for% the% purpose% of% enjoining% the%
unlawful% competitor% from% proceeding% further% with% the%
unlawful%competition,%and%damages,%in%order%to%allow%the%
aggrieved%party%to%recover%the%damage%he%has%suffered%by%
virtue%of%the%said%unlawful%competition.%Hence,%the%election%
of% the% complainant% (private% respondent% herein)% for% the%
accounting%of%petitioner's%(defendant%below)%gross%sales%as%
damages%per%R.A.%166,%appears%most%relevant.%For%Us,%to%
determine%the%amount%of%damages%allowable%after%the%final%
determination% of% the% unfair% labor% case% would% not% only%
render%nugatory%the%rights%of%complainant%under%Sec.%23%of%
R.A.%166,%but%would%be%a%repetitious%process%causing%only%
unnecessary%delay.%
2.% assails"that"private"respondent"is"a"foreign"corporation"not"
licensed" to" do" business" in" the" Philippines" and" that"
respondent" Edwardson" is" merely" its" licenseef" that"
respondent"Converse"has"no"goodwill"to"speak"of"and"that"
it"has"no"registrable"right"over"its"own"name"–"answered%in%
the% case% of% Converse% Rubber% Corporation% vs.% Jacinto%
Rubber%&%Plastic%Co.,%Inc:%
The%disability%of%a%foreign%corporation%from%suing%in%
the%Philippines%is%limited%to%suits%to%enforce%any%legal%
of%contract%rights%arising%from,%or%growing%out,%of%any%
Islands%...%On%the%other%hand,%where%the%purpose%of%
the% suit% is% "to% protect% its% reputation,% its% corporate%
name,% its% goodwill,% whenever% that% reputation,%
corporate% name% or% goodwill% have,% through% the%
natural% development% of% its% trade,% established%
themselves",% an% unlicensed% foreign% corporation%
may% sue% in% the% Philippines.% So% interpreted% by% the%
Supreme% Court,% it% is% clear% that% Section% 29% of% the%
Corporation% Law% does% not% disqualify% plaintiffZ
appellee%Converse%Rubber,%which%does%not%have%a%
branch% office% in% any% part% of% the% Philippines% and% is%
not% "doing% business"% in% the% Philippines,% from% filing%
and%prosecuting%this%action%for%unfair%competition.%
Lastly,%the%establishment%of%the%petitioner%burned%down%together%
with% all% the% records% sought% to% be% produced% by% the% questioned%
"subpoena%duces"tecum,"%hence%this%case%has%become%moot%and%
academic.%We%have%no%recourse%but%to%dismiss%the%same.%
WHEREFORE,% the% instant% petition% is% DISMISSED% for%
becoming%moot%and%academic.%No%costs.%
Republic%Act%No.%166,'%which%provides:%
CHAPTER%V.—Rights%and%Remedies%
xxx%xxx%xxx%
$
Sec.% 23.% Actions," and" damages" and" injunction" for" (1)%the%reasonable%profit%which%the%complaining%party%would%have%
infringement." —% Any% person% entitled% to% the% made,%had%the%defendant%not%infringed%his%said%rights`%or%%
exclusive% use% of% a% registered% mark% or% trade% name%
may% recover% damages% in% a% civil% action% from% any% (2)% the% profit% which% the% defendant% actually% made% out% of% the%
person%who%infringes%his%rights%and%the%measure%of% infringement`%or%%
the% damages% suffered% shag% be% either% the%
reasonable% profit% which% the% complaining% party% (3)%the%court%may%award%as%damages%a%reasonable%percentage%
would%have%made,%had%the%defendant%not%infringed% based% upon% the% amount% of% gross% sales% of% the% defendant% of% the%
his% said% rights,% or% the% profit% which% the% defendant% value% of% the% services% in% connection% with% which% the% mark% or%
actually%made%out%of%the%infringment%management,% tradename% was% issued% in% the% infringement% of% the% rights% of% the%
or% in% the% event% such% measure% of% damages% cannot% complaining%party.%
be% readily% ascertained% with% reasonable% certainty,%
their% the% court% may% award% as% damages% a% %
reasonable%percentage%based%upon%the%amount%of%
gross% sales% of% the% defendant% of% the% value% of% the%
services%in%connection%with%which%the%mark%or%trade%
name%was%used%in%the%infringement%of%the%rights%of%
the%complaining%party.%In%cases%where%actual%intent%
to%mislead%the%public%or%to%defraud%the%complaining%
party%shall%be%shown%in%the%discretion%of%the%court,%
the%damages%may%be%doubled.%

The%complaining%party,%upon%proper%showing%may%
also%be%granted%injunction.%

In% recovering% the% loss% suffered% by% the% aggrieved% party% due% to%
unfair% competition,% Sec.% 23% of% R.A.% 166% grants% the% complainant%
three%options%within%which%to%ascertain%the%amount%of%damages%
recoverable,%either:%%
$
Converse% Rubber% Corp.% and% Edwardson% Manufacturing% vs.%
Jacinto% Rubber% &% Plastic% Co.% and% Ace% Rubber% &% Plastics%
Corp.%
% continue%manufacturing%and%selling%its%own%products.%%
FACTS:%
-% Converse% Rubber% Corporation,% is% an% American%
Corporation,%manufacturer%of%canvas%rubber%shoes%under%
the%trade%name%‘Converse%Chuck%Taylor%All%Star.%It%has%an%
exclusive%licensee%in%the%Philippines,%plaintiff%Edwardson%
Manufacturing% Corporation,% for% the% manufacture% and%
sale%in%the%Philippines%of%its%product.%%
-% Converse% is% the% owner% of% trademarks% and% patent,%
registered%with%United%States%Patent%Office,%covering%the%
words%‘All%Star’,%the%representation%and%design%of%a%five>
pointed%star,%and%the%design%of%the%sole.%The%trademark%
‘Chuck%Taylor’%was%registered%by%plaintiff%Converse%with%
the%Philippines%Patent%Office%on%March%3,%1966.%%
-% Since% 1946,% ‘Chuck% Taylor’% is% being% sold% in% the%
Philippines.% It% has% been% used% exclusively% by% Philippine%
basketball%teams%competing%in%international%competitions.%
‘Chuck%Taylor’%currently%retails%at%P46.00%per%pair.%%
-% Defendant%Jacinto%Rubber%&%Plastics%Company,%Inc.,%a%
local%corporation,%likewise,%manufactures%and%sells%canvas%
rubber% shoes.% It% sells% its% product% under% the% trade% names%
‘Custombuilt% Viscount’,% ‘Custombuilt% Challenger’,% and%
‘Custombuilt%Jayson’s’.%%
-% Its% trademark% Custombuilt% Jayson’s% was% registered% by%
the%Philippines%Patent%Office%on%November%29,%1957.%The%
gross%sales%from%1962%to%1965%of%‘Custombuilt’%shoes%total%
P16,474,103.76.%‘Custombuilt’%is%retailed%at%P11.00.%
-% Converse%and%defendant%Jacinto%entered%into%protracted%
negotiations%for%a%licensing%agreement%whereby%defendant%
Jacinto% would% be% the% exclusive% license% of% plaintiff%
Converse%in%the%Philippines%for%the%manufacture%and%
sale% of% ‘Chuck% Taylor’% shoes% but% with% the% right% to%
-% One%of%the%points%taken%up%by%parties%was%the%design%and%
general% appearance% of% Custombuilt’% shoes.% Plaintiff%
Converse%insisted%on%the%condition%that%defendant%Jacinto%
change% the% design% of% ‘Custombuilt’% shoes% so% as% to% give%
‘Custombuilt’%a%general%appearance%different%from%Chuck%
Taylor.’%%
-% After%an%extensive%discussion,%defendant%Jacinto%gave%into%
to%the%demand%of%plaintiff%Converse`%it%submitted%to%plaintiff%
Converse% for% the% latter’s% approval% a% sketch% of% a% new%
design% for% ‘Custombuilt’.% This% design% was% accepted% by%
plaintiff%Converse.%%
-% Jacinto% Rubber% then% proposed% that% the% licensing%
agreement%be%made%in%favor%of%its%affiliates,%Ace%Rubber,%
who%signed%the%licensing%agreement%while%Jacinto%Rubber%
and% Arturo% Jacinto% signed% the% guarantee% agreement% to%
secure%the%performance%by%Ace%Rubber%of%its%obligations%
under%the%licensing%agreement.%
-% Under%the%Licensing%Agreement,%it%was%agreed%that%Ace%
shall% not,% during% the% term% hereof,% manufacture% or% sell%
footwear%which%would,%by%reason%of%its%appearance%and/or%
design,%be%likely,%or%tend,%to%be%confused%by%the%public%with%
any%of%the%ConverseZnamed%products%to%be%manufactured%
and% sold% hereunder,% or% shall,% in% any% manner,% infringe%
Converse%designs.%
-% However,% the% licensing% agreement% did% not% materialize,%
because% Hermogenes% Jacinto% refused% to% sign% the%
guarantee.%%
$
-% Plaintiff%Converse%and%plaintiff%Edwardson%then%executed%
the%licensing%agreement,%making%Edwardson%the%exclusive%
Philippine%licensee%for%the%manufacture%and%sale%of%Chuck%
Taylor.%
-% Plaintiffs% sent% a% written% demand% to% defendants% to% stop%
manufacturing%and%selling%‘Custombuilt’%shoes%of%identical%
appearance%as%‘Chuck%Taylor’.%Defendants%did%not%reply%to%
plaintiffs’%letter.%Hence,%this%suit.%
% signatory%to%this%Convention.%Section%1126%(b)%and%(h)%of%
ISSUE:%Whether%there%is%unfair%competition%between%the%2%rubber%
shoes%products.%
% to%file%an%action%for%unfair%competition%in%the%United%States%
HELD:%YES%
-% Custombuilt% shoes% have% practically% all% the% features% of%
Converse.%
-% the% respective% designs,% shapes,% the% colors% of% the% ankle%
patches,%the%bands,%the%toe%patch%and%the%soles%of%the%two%
products%are%exactly%the%same%such%that%“at%a%distance%of%
a%few%meters,%it%is%impossible%to%distinguish%“Custombuilt”%
from%“Chuck%Taylor.”%
-% Custombuilt%could%easily%be%passed%off%for%Chuck%Taylor.%%
-% It% denominates% as% ‘unfair% competition’% ‘any% acts’%
calculated% to% result% in% the% passing% off% of% other% goods% ‘for%
those% of% the% one% having% established% such% goodwill.’%
Singularly%absent%is%a%requirement%that%the%goodwill%sought%
to% be% protected% in% an% action% for% unfair% competition% must%
have%been%established%in%an%actual%competitive%situation.%
Nor%does%the%law%require%that%the%deception%or%other%means%
contrary% to% good% faith% or% any% acts% calculated% to% pass% off%
other% goods% for% those% of% one% who% has% established% a%
goodwill% must% have% been% committed% in% an% actual%
competitive%situation.%
-% A% nonZresident% foreign% corporation% may% sue% in% the%
Philippines%for%unfair%competition.%The%Convention%of%Paris%
for% the% Protection% of% Industrial% Property,% to% which% the%
Philippines% adheres,% provides,% on% a% reciprocal% basis% that%
citizens% of% a% union% member% may% file% an% action% for% unfair%
competition%and%infringement%of%trademarks,%patents,%etc.%
in% any% of% the% union% members.% The% United% States% of%
America,%of%which%Converse%Rubber%is%a%citizen,%is%also%a%
Public% Law% 489% of% the% United% States% of% America% allows%
corporations%organized%under%the%laws%of%the%Philippines%
of%America,%whether%or%not%it%is%licensed%to%do%business%in%
the%United%States.%
%
Difference%between%infringement%and%unfair%competition%
-% Priority%in%registration%in%the%Philippines%of%a%trademark%is%
not% material% in% an% action% for% unfair% competition% as%
distinguished% from% an% action% for% infringement% of%
trademark.%%
The% basis% of% an% action% for% unfair% competition% is%
confusing% and% misleading% similarity% in% general%
appearance,%not%similarity%of%trademarks.%
Clearly,% this% case% satisfied% the% test% of% unfair%
competition%
%
$
CASE% 195:% ASIA% BREWERY,% INC.% vs% COURT% OF% APPEALS%
AND%SAN%MIGUEL%CORPORATION%
G.R.%No.%%103543%
DATE:%5%July%1993%
PONENTE:%Griño>Aquino,%J.%
TOPIC:%Civil%Actionf%Infringement%
% The%"S"%in%"San"%and%the%"M"%of%"Miguel,"%"P"%of%"Pale"%
DOCTRINE:% Only% registered% trade% marks,% trade% names% and%
service%marks%are%protected%against%infringement%or%unauthorized%
use%by%another%or%others.%The%use%of%someone%else's%registered%
trademark,%trade%name%or%service%mark%is%unauthorized,%hence,%
actionable,%if%it%is%done%"without%the%consent%of%the%registrant."%
%
FACTS:%
#% Sept.% 15,% 1988% Z% SMC% filed% a% complaint% against% ABI% for%
infringement%of%trademark%and%unfair%competition%on%account%
of%the%ABI’s%“Beer%Pale%Pilsen”%or%“Beer%Na%Beer”%product,%
which% has% been% competing% with% SMC's% “San% Miguel% Pale%
Pilsen”%for%a%share%of%the%local%beer%market.%
#% Aug.%27,%1990%–%The%trial%court%dismissed%SMC's%complaint%
because% ABI% "has% not% committed% trademark% infringement% or%
unfair%competition%against"%SMC.%The%trial%court%described%in%
its%decision%the%trademarks%of%SMC%and%ABI.%
o% SMC% >% The% registered% trademark% of% SMC% for% its% pale%
pilsen% beer% is% “San% Miguel% Pale% Pilsen% With%
Rectangular% Hops% and% Malt% Design.”% % Its% rectangular%
design%is%bordered%by%what%appears%to%be%minute%grains%
arranged%in%rows%of%three%in%which%there%appear%in%each%
corner% hop% designs.% At% the% top% is% a% phrase% written% in%
small%print%"Reg.%Phil.%Pat.%Off."%and%at%the%bottom%"Net%
Contents:%320%Ml."%The%dominant%feature%is%the%phrase%
"San%Miguel"%written%horizontally%at%the%upper%portion.%
Below% are% the% words% "Pale% Pilsen"% written% diagonally%
across%the%middle%of%the%rectangular%design.%In%between%
is% a% coat% of% arms% and% the% phrase% "Expertly% Brewed."%
and% "Pilsen"% are% written% in% Gothic% letters% with% fine%
strokes% of% serifs,% the% kind% that% first% appeared% in% the%
1780s% in% England% and% used% for% printing% German% as%
distinguished% from% Roman% and% Italic.% Below% "Pale%
Pilsen"% is% the% statement% "And% Bottled% by"% (first% line,%
"San%Miguel%Brewery"%(second%line),%and%"Philippines"%
(third%line).%%
o% ABI%Z%a%rectangular%design%bordered%by%what%appear%to%
be%buds%of%flowers%with%leaves.%The%dominant%feature%
is% "Beer"% written% across% the% upper% portion% of% the%
rectangular%design.%The%phrase%"Pale%Pilsen"%appears%
immediately%below%in%smaller%block%letters.%To%the%left%
is%a%hop%design%and%to%the%right,%written%in%small%prints,%
is% the% phrase% "Net% Contents% 320% ml."% Immediately%
below% "Pale% Pilsen"% is% the% statement% written% in% three%
lines% "Especially% brewed% and% bottled% by"% (first% line),%
"Asia% Brewery% Incorporated"% (second% line),% and%
"Philippines"%(third%line).%
#% Sept.%30,%1991%–%The%CA%reversed%the%trial%court.%It%found%ABI%
guilty%of%infringement%of%trademark%and%unfair%competition.%It%
ordered%ABI%to:%
o% Enjoin% from% manufacturing,% putting% up,% selling,%
$
advertising,% offering% or% announcing% for% sale,% or%
supplying%Beer%Pale%Pilsen,%or%any%similar%preparation,%
manufacture% or% beer% in% bottles% and% under% labels%
substantially%identical%with%or%like%the%said%bottles%and%
labels% of% SMC% employed% for% that% purpose,% or%
substantially%identical%with%or%like%the%bottles%and%labels%
now%employed%by%ABI%for%that%purpose,%or%in%bottles%or%
under% labels% which% are% calculated% to% deceive%
purchasers%and%consumers%into%the%belief%that%the%beer%
is% the% product% of% SMC% or% which% will% enable% others% to%
substitute,%sell%or%palm%off%the%said%beer%of%ABI%as%and%
for%the%beer%of%the%SMC.%
o% ABI%is%hereby%ordered%to%render%an%accounting%and%pay%
the%SMC%double%any%and%all%the%payments%derived%by%
ABI% from% operations% of% its% business% and% the% sale% of%
goods%bearing%the%mark%"Beer%Pale%Pilsen"%estimated%
at% approximately% Php% 5M`% to% recall% all% its% products%
bearing%the%mark%"Beer%Pale%Pilsen"%from%its%retailers%
and% deliver% these% as% well% as% all% labels,% signs,% prints,%
packages,% wrappers,% receptacles% and% advertisements%
bearing% the% infringing% mark% and% all% plates,% molds,%
materials%and%other%means%of%making%the%same%to%the%
Court% authorized% to% execute% this% judgment% for%
destruction.%
o% ABI%is%hereby%ordered%to%pay%SMC%the%sum%of%Php%2M%
as% moral% damages,% Php% 500K% by% way% of% exemplary%
damages,%and%Php%250K%as%attorney’s%fees.%
#% Upon%filing%of%an%MR,%the%CA%modified%its%decision%regarding%
the%second%order:%
The%ABI%is%hereby%ordered%to%recall%all%its%products%bearing%the%
mark%Beer%Pale%Pilsen%from%its%retailers%and%deliver%these%as%well%
as%all%labels,%signs,%prints,%packages,%wrappers,%receptacles%and%
advertisements%bearing%the%infringing%mark%and%all%plates,%molds,%
materials% and% other% means% of% making% the% same% to% the% Court%
authorized% to% execute% this% judgment% for% destruction.% (Removed%
the%first%clause)%
%
ISSUE:% WON% ABI% infringes% SMC's% trademark% and% committed%
unfair%competition?%
%
HELD/RATIO:%
NO.%There%is%no%infringement%and%unfair%competition.%
#% Infringement%of%trademark%is%a%form%of%unfair%competition.%Sec.%
22% of% RA% 166,% otherwise% known% as% the% Trademark% Law,%
defines%what%constitutes%infringement:%
Sec.%22.%Infringement,%what%constitutes.%—%Any%person%who%shall%
use,% without% the% consent% of% the% registrant,% any% reproduction,%
counterfeit,%copy%or%colorable%imitation%of%any%registered%mark%or%
tradeZname% in% connection% with% the% sale,% offering% for% sale,% or%
advertising%of%any%goods,%business%or%services%on%or%in%connection%
with%which%such%use%is%likely%to%cause%confusion%or%mistake%or%to%
deceive%purchasers%or%others%as%to%the%source%or%origin%of%such%
goods% or% services,% or% identity% of% such% business`% or% reproduce,%
counterfeit,% copy% or% colorably% imitate% any% such% mark% or% tradeZ
name%and%apply%such%reproduction,%counterfeit,%copy,%or%colorable%
imitation%to%labels,%signs,%prints,%packages,%wrappers,%receptacles%
or%advertisements%intended%to%be%used%upon%or%in%connection%with%
such%goods,%business%or%services,%shall%be%liable%to%a%civil%action%
by%the%registrant%for%any%or%all%of%the%remedies%herein%provided.%
$
#% This% definition% implies% that% only% registered% trade% marks,%
trade% names% and% service% marks% are% protected% against%
infringement% or% unauthorized% use% by% another% or% others.%
The% use% of% someone% else's% registered% trademark,% trade%
name%or%service%mark%is%unauthorized,%hence,%actionable,%
if%it%is%done%"without%the%consent%of%the%registrant."%
#% The%trial%court%perceptively%observed%that%the%word%"BEER"%
does%not%appear%in%SMC's%trademark,%just%as%the%words%"SAN%
MIGUEL"%do%not%appear%in%ABI's%trademark.%Hence,%there%is%
absolutely% no% similarity% in% the% dominant% features% of% both%
trademarks.%
#% Neither%in%sound,%spelling%or%appearance%can%BEER%PALE%
PILSEN%be%said%to%be%confusingly%similar%to%SAN%MIGUEL%
PALE% PILSEN.% No% one% who% purchases% BEER% PALE%
PILSEN%can%possibly%be%deceived%that%it%is%SAN%MIGUEL%
PALE%PILSEN.%No%evidence%whatsoever%was%presented%by%
SMC%proving%otherwise.%
#% Besides% the% dissimilarity% in% their% names,% the% following% other%
dissimilarities% in% the% trade% dress% or% appearance% of% the%
competing%products%abound:%
1.% The%SAN%MIGUEL%PALE%PILSEN%bottle%has%a%slender%
tapered%neck.%The%BEER%PALE%PILSEN%bottle%has%a%
fat,%bulging%neck.%
2.% The%words%"pale%pilsen"%on%SMC's%label%are%printed%in%
bold%and%laced%letters%along%a%diagonal%band,%whereas%
the%words%"pale%pilsen"%on%ABI's%bottle%are%half%the%size%
and% printed% in% slender% block% letters% on% a%
straight%horizontal%band.%%
3.% The% names% of% the% manufacturers% are% prominently%
printed%on%their%respective%bottles.%
4.% SAN% MIGUEL% PALE% PILSEN% is% "Bottled% by% the% San%
Miguel% Brewery,% Philippines,"% whereas% BEER% PALE%
PILSEN% is% "Especially% brewed% and% bottled% by% Asia%
Brewery%Incorporated,%Philippines."%
5.% On%the%back%of%ABI's%bottle%is%printed%in%big,%bold%letters,%
under%a%row%of%flower%buds%and%leaves,%its%copyrighted%
slogan:% "BEER% NA% BEER!"% Whereas% SMC's% bottle%
carries%no%slogan.%
6.% The% back% of% the% SAN% MIGUEL% PALE% PILSEN% bottle%
carries% the% SMC% logo,% whereas% the% BEER% PALE%
PILSEN%bottle%has%no%logo.%
7.% The% SAN% MIGUEL% PALE% PILSEN% bottle% cap% is%
stamped%with%a%coat%of%arms%and%the%words%"San%Miguel%
Brewery% Philippines"% encircling% the% same.% The% BEER%
PALE% PILSEN% bottle% cap% is% stamped% with% the% name%
"BEER"%in%the%center,%surrounded%by%the%words%"Asia%
Brewery%Incorporated%Philippines."%
8.% Finally,%there%is%a%substantial%price%difference%between%
BEER%PALE%PILSEN%(currently%at%Php%4.25%per%bottle)%
and%SAN%MIGUEL%PALE%PILSEN%(currently%at%Php%7%
per%bottle).%One%who%pays%only%Php%4.25%for%a%bottle%of%
beer%cannot%expect%to%receive%San%Miguel%Pale%Pilsen%
from%the%storekeeper%or%bartender.%
#% The% fact% that% the% words% pale% pilsen% are% part% of% ABI's%
trademark% does% not% constitute% an% infringement% of%
SMC's% trademark:% SAN% MIGUEL% PALE% PILSEN,% for%
"pale% pilsen"% are% generic% words% descriptive% of% the%
color%("pale"),%of%a%type%of%beer%("pilsen"),%which%is%a%
light% bohemian% beer% with% a% strong% hops% flavor% that%
originated%in%the%City%of%Pilsen%in%Czechoslovakia%and%
became% famous% in% the% Middle% Ages.% "Pilsen"% is% a%
"primarily% geographically% descriptive% word,"% hence,%
non>registerable% and% not% appropriable% by% any% beer%
manufacturer.%%
$
#% The%words%"pale%pilsen"%may%not%be%appropriated%by%SMC%
for%its%exclusive%use%even%if%they%are%part%of%its%registered%
trademark:%SAN%MIGUEL%PALE%PILSEN,%any%more%than%
such% descriptive% words% as% "evaporated% milk,"% "tomato%
ketchup,"%"cheddar%cheese,"%"corn%flakes"%and%"cooking%oil"%
may%be%appropriated%by%any%single%manufacturer%of%these%
food% products,% for% no% other% reason% than% that% he% was% the%
first%to%use%them%in%his%registered%trademark.%%
The%circumstance%that%the%manufacturer%of%BEER%PALE%PILSEN,%
ABI,%has%printed%its%name%all%over%the%bottle%of%its%beer%product:%
on%the%label,%on%the%back%of%the%bottle,%as%well%as%on%the%bottle%
cap,% disproves% SMC's% charge% that% ABI% dishonestly% and%
fraudulently%intends%to%palm%off%its%BEER%PALE%PILSEN%as%SMC's%
product.% In% view% of% the% visible% differences% between% the% two%
products,%the%Court%believes%it%is%quite%unlikely%that%a%customer%of%
average% intelligence% would% mistake% a% bottle% of% BEER% PALE%
PILSEN%for%SAN%MIGUEL%PALE%PILSEN.%
$
Solid%Triangle%Sales%Corporation%vs%the%Sheriff%of%RTC%QC%
370%scra%491,%Nov.%23,%2001%
%
FACTS:%%
Judge%Bruselas,Jr.,%Presiding%Judge%of%RTC,%Quezon%City,%upon%
application% of% the% Economic% Intelligence% and% Investigation%
Bureau(EIIB),% issued% a% search% warrant% against% herein% private%
respondent%Sanly%Corporation%for%violation%of%Sec.%168%of%R.A%No.%
8293%for%unfair%competition.%The%private%respondent%corporation%
contends% that% there% is% no% unfair% competition% being% committed%
since% the% products% that% he% sells,% particularly% Mitsubishi%
photographic%color%paper,%are%genuine%products%of%Mitsubishi%that%
he% buys% from% Hong% Kong% while% the% complainant% purchases% the%
same%kind%of%paper%from%Japan.%
ISSUE:% Whether% there% was% probable% cause% that% the% crime% of%
unfair%competition%under%the%IPC%Code%has%been%committed%by%
the%respondents%
HELD:%%
No.%The%SC%disagreed%with%petitioners%and%find%that%the%evidence%
presented%before%the%trial%court%does%not%prove%unfair%competition%
under%Section%168%of%the%Intellectual%Property%Code.%%%
Under" SEC." 168." Unfair" Competition," Rights,"
Regulation"and"Remedies."–"168.1"A"person"who"has"
identified" in" the" mind" of" the" public" goods" he"
manufactures"or"deals"in,"his"business"or"services"from"
those" of" others," whether" or" not" a" registered" mark" is"
employed," has" a" property" right" in" the" goodwill" of" the"
said" goods," business" or" services" so" identified," which"
will"be"protected"in"the"same"manner"as"other"property"
rights."
168.2"Any"person"who"shall"employ"deception"or"any"
other"means"contrary"to"good"faith"by"which"he"shall"
pass"off"the"goods"manufactured"by"him"or"in"which"he"
deals,"or"his"business,"or"services"for"those"of"the"one"
having"established"such"goodwill,"or"who"shall"commit"
any" acts" calculated" to" produce" said" result," shall" be"
guilty"of"unfair"competition,"and"shall"be"subject"to"an"
action"therefor."
168.3"In"particular,"and"without"in"any"way"limiting"the"
scope" of" protection" against" unfair" competition," the"
following"shall"be"deemed"guilty"of"unfair"competition:"
(a)"Any"person,"who"is"selling"his"goods"and"gives"them"
the" general" appearance" of" goods" of" another"
manufacturer" or" dealer," either" as" to" the" goods"
themselves"or"in"the"wrapping"of"the"packages"in"which"
they"are"contained,"or"the"devices"or"words"thereon,"or"
in"any"other"feature"of"their"appearance,"which"would"
be" likely" to" influence" purchasers" to" believe" that" the"
goods" offered" are" those" of" a" manufacturer" or" dealer,"
other" than" the" actual" manufacturer" or" dealer," or" who"
otherwise"clothes"the"goods"with"such"appearance"as"
shall" deceive" the" public" and" defraud" another" of" his"
legitimate" trade," or" any" subsequent" vendor" of" such"
goods"or"any"agent"of"any"vendor"engaged"in"selling"
such"goods"with"a"lie"purposef"
(b)"Any"person"who"by"any"artifice,"or"device,"or"who"
employs" any" other" means" calculated" to" induce" the"
$
false"belief"that"such"person"is"offering"the"service"of" reproduction% and% distribution% of% counterfeit% “PlayStation”%
another"who"has"identified"such"services"in"the"mind"of" game% software,% consoles% and% accessories% in% violation% of%
the"publicf"or" petitioner’s%intellectual%property%rights.%%
•% The% NBI% applied% and% was% issued% by% the% Regional% Trial%
(c)"Any"person"who"shall"make"any"false"statement"in"
Court% (RTC)% of% Manila% warrants% to% search% respondent’s%
the"course"of"trade"or"who"shall"commit"any"other"act"
premises% in% Paranaque% City% and% Cavite,% wherein% a%
contrary"to"good"faith"of"a"nature"calculated"to"discredit"
replicating% machine% and% several% units% of% counterfeit%
the"goods,"business"or"services"of"another."
“PlayStation”% consoles,% joy% pads,% housing,% labels% and%
168.4" The" remedies" provided" by" Sections" 156," 157" game%software%were%seized%on%the%subject%premises.%
and"161"shall"apply"mutatis"mutandis." •% Respondent%questioned%the%validity%of%the%search%warrants%
issued% by% the% RTC% of% Manila,% particularly% the% search%
Sanly%Corporation%did%not%pass%off%the%subject%goods%as%that%of% warrant%covering%respondent’s%premises%in%Cavite%on%the%
another.%%Indeed,%it%admits%that%the%goods%are%genuine%Mitsubishi% ground%of%%improper%venue,%and%filed%%a%motion%to%quash%
photographic%paper,%which%it%purchased%from%a%supplier%in%Hong% and/or%release%of%the%seized%properties.%%
Kong.% Petitioners% also% allege% that% private% respondents% “made% it% •% The%trial%court%affirmed%the%validity%of%the%search%warrant%
appear% that% they% were% duly% authorized% to% sell% or% distribute% covering% respondent’s% premises% in% Paranaque% City% but%
Mitsubishi%Photo%Paper%in%the%Philippines.”%Assuming%that%this%act% quashed%search%warrant%covering%respondent’s%premises%
constitutes% a% crime,% there% is% no% proof% to% establish% such% an% in%Cavite.%
allegation.% •% Petitioner%elevated%the%matter%to%the%Court%of%Appeals%(CA)%
% contending% that% the% rule% on% venue% for% search% warrant%
application% is% not% jurisdictional.% He% further% asserted% that%
% even% granting% that% the% rules% on% search% warrants%
applications%are%jurisdictional,%the%application%filed%either%in%
%
the%courts%of%the%NCR%or%4th%Judicial%Region%is%still%proper%
Sony%Computer%Entertainment%Inc.%vs.%Supergreen%Inc.% because%the%crime%was%continuing%and%committed%in%both%
G.R.%No.%161823,%March%22,%2007% Paranaque%City%and%Cavite.%%
% %
Facts:% Issue:%
% %
•% Petitioner% filed% a% complaint% with% the% National% Bureau% of% Whether%or%not%the%case%at%bar%involves%a%transitory%or%continuing%
Investigation%(NBI)%against%respondent%for%engaging%in%the% offense% of% unfair% competition,% thus% making% the% search% warrant%
$
issued%by%the%RTC%of%Manila%covering%the%respondent’s%premises% be%likely%to%influence%purchasers%to%believe%that%the%goods%offered%
in%Cavite%valid.% are% those% of% a% manufacturer% or% dealer,% other% than% the% actual%
% manufacturer%or%dealer,%or%who%otherwise%clothes%the%goods%with%
Held:% such%appearance%as%shall%deceive%the%public%and%defraud%another%
% of%his%legitimate%trade,%or%any%subsequent%vendor%of%such%goods%
Yes.%% or%any%agent%of%any%vendor%engaged%in%selling%such%goods%with%a%
% like%purpose`%
Nonetheless,% we% agree% with% petitioner% that% this% case% involves% a%
transitory% or% continuing% offense% of% unfair% competition% under% %%%%%%%%%%%%(b)% % Any% person% who% by% any% artifice,% or% device,% or% who%
Section%168%of%Republic%Act%(RA)%No.%8293.%Pertinent%too%is%Article% employs% any% other% means% calculated% to% induce% the% false% belief%
189%(1)%of%the%Revised%Penal%Code%(RPC)%that%enumerates%the% that% such% person% is% offering% the% services% of% another% who% has%
elements%of%unfair%competition.% identified%such%services%in%the%mind%of%the%public`%or%
% %%%%%%%%%%%%(c)%%Any%person%who%shall%make%any%false%statement%in%the%
SEC.%168.%Unfair%Competition,%Rights,%Regulation%and%Remedies.% course% of% trade% or% who% shall% commit% any% other% act% contrary% to%
–%…% good%faith%of%a%nature%calculated%to%discredit%the%goods,%business%
168.2.% Any% person% who% shall% employ% deception% or% any% other% or%services%of%another.%
means%contrary%to%good%faith%by%which%he%shall%pass%off%the%goods% Pertinent% too% is% Article% 189% (1)% of% the% Revised% Penal% Code% that%
manufactured% by% him% or% in% which% he% deals,% or% his% business,% or% enumerates%the%elements%of%unfair%competition,%to%wit:%
services%for%those%of%the%one%having%established%such%goodwill,%or%
who%shall%commit%any%acts%calculated%to%produce%said%result,%shall% (a)%%That%the%offender%gives%his%goods%the%general%appearance%of%
be%guilty%of%unfair%competition,%and%shall%be%subject%to%an%action% the%goods%of%another%manufacturer%or%dealer`%%
therefor.%
(b)% % That% the% general% appearance% is% shown% in% the% (1)% goods%
168.3.%In%particular,%and%without%in%any%way%limiting%the%scope%of% themselves,%or%in%the%(2)%wrapping%of%their%packages,%or%in%the%(3)%
protection% against% unfair% competition,% the% following% shall% be% device% or% words% therein,% or% in% (4)% any% other% feature% of% their%
deemed%guilty%of%unfair%competition:% appearance`%

%%%%%%%%%%%%(a)%%Any%person,%who%is%selling%his%goods%and%gives%them%
the% general% appearance% of% goods% of% another% manufacturer% or%
dealer,%either%as%to%the%goods%themselves%or%in%the%wrapping%of%
the%packages%in%which%they%are%contained,%or%the%devices%or%words%
thereon,%or%in%any%other%feature%of%their%appearance,%which%%would%
(c)%%That%the%offender%offers%to%sell%or%sells%those%goods%or%gives%
other%persons%a%chance%or%opportunity%to%do%the%same%with%a%like%
purpose`%and%
$
(d)%%That%there%is%actual%intent%to%deceive%the%public%or%defraud%a%
competitor.%

Respondent’s%imitation%of%the%general%appearance%of%petitioner’s%
goods%was%done%allegedly%in%Cavite.%%It%sold%the%goods%allegedly%
in% Mandaluyong% City,% Metro% Manila.% % The% alleged% acts% would%
constitute%a%transitory%or%continuing%offense.%%Thus,%clearly,%under%
Section%2%(b)%of%Rule%126,%Section%168%of%Rep.%Act%No.%8293%and%
Article%189%(1)%of%the%Revised%Penal%Code,%petitioner%may%apply%
for% a% search% warrant% in% any% court% where% any% element% of% the%
alleged%offense%was%committed,%including%any%of%the%courts%within%
the%National%Capital%Region%(Metro%Manila).%

Wherefore%the%petition%is%granted.%
%
%
%

%
$
SEHWANI,%INC.%AND%BENITA’S%FRITES,%INC.%VS.%IN>N>OUT%
BURGER,%INC.,%536%SCRA%255%(2007)%
DOCTRINE:%%
Section%151(b)%of%RA%8293%provides%that%a%petition%to%cancel%a%
registration%of%a%mark%may%be%filed%with%the%Bureau%of%Legal%Affairs%
by%any%person%who%believes%that%he%is%or%will%be%damaged%by%the%
registration%of%a%mark%at%any%time,%if%the%registered%mark%becomes%
the%generic%name%for%the%goods%or%services,%or%a%portion%thereof,%
for% which% it% is% registered,% or% has% been% abandoned,% or% its%
registration%was%fraudulently%or%contrary%to%the%provisions%of%this%
Act,% or% if% the% registered% mark% is% being% used% by% or% with% the%
permission%of,%the%registrant%so%as%to%misrepresent%the%source%of%
goods% or% services% on% or% in% connection% with% which% the% mark% is%
used.%
% TRIPS% Agreement.% It% is% engaged% mainly% in% the% restaurant%
SUMMARY%OF%ARGUMENTS:%
Petitioner’s%Claims:%
Petitioners%alleged%that%the%Respondent%lack%the%legal%capacity%to%
sue%because%it%was%not%doing%business%in%the%Philippines%and%that%
it% has% no% cause% of% action% because% its% mark% is% not% registered% or%
used%in%the%Philippines.%%Sehwani,%Inc.%also%claimed%that%as%the%
registered% owner% of% the% “IN% N% OUT”% mark,% it% enjoys% the%
presumption%that%the%same%was%validly%acquired%and%that%it%has%
the%exclusive%right%to%use%the%mark.%%Moreover,%petitioners%argued%
that%other%than%the%bare%allegation%of%fraud%in%the%registration%of%
the%mark,%respondent%failed%to%show%the%existence%of%any%grounds%
of%cancellation%thereof%under%Section%151%of%the%IP%Code%of%the%
Philippines.%%It%also%alleged%that%the%action%is%barred%by%laches.%
% mark%applications%with%the%Bureau%of%Trademarks%for%the%“INZNZ
Respondent’s%Claims:%
Respondent,%InZnZout%Burger,%Inc.,%%alleged%that%it%is%the%owner%of%
the% tradename% “INZNZOUT”% and% trademarks% “INZNZOUT,”% “INZNZ
OUT%Burger%&%Arrow%Design”%and%“INZNZOUT%Burger%Logo”%which%
are% used% in% its% business% since% 1948% up% to% the% present.% % These%
tradename%and%trademarks%were%registered%in%the%United%States%
as% well% as% in% other% parts% of% the% world.% % Petitioner% Sehwani%
allegedly%had%obtained%a%trademark%registration%for%the%mark%“IN%
N% OUT”% (with% the% inside% letter% O% formed% like% a% star)% without% its%
authority.%
%
FACTS:%
Petitioner% INZNZOUT% BURGER,% INC.,% is% a% business% entity%
incorporated%under%the%laws%of%California.%It%is%a%signatory%to%the%
Convention%of%Paris%on%Protection%of%Industrial%Property%and%the%
business,%but%it%has%never%engaged%in%business%in%the%Philippines.%
Respondents%Sehwani,%Incorporated%and%Benita%Frites,%Inc.%are%
corporations% organized% in% the% Philippines.% Sometime% in% 1991,%
Sehwani%filed%with%the%BPTTT%an%application%for%the%registration%
of%the%mark%“IN%N%OUT%(the%inside%of%the%letter%“O”%formed%like%a%
star).%Its%application%was%approved%and%a%certificate%of%registration%
was%issued%in%its%name%on%1993.%In%2000,%Sehwani,%Incorporated%
and% Benita% Frites,% Inc.% entered% into% a% Licensing% Agreement,%
wherein%the%former%entitled%the%latter%to%use%its%registered%mark,%
“IN%N%OUT.”%
Sometime%in%1997,%InZNZOut%Burger%filed%trademark%and%service%
OUT”%and%“INZNZOUT%Burger%&%Arrow%Design.%In%2000,%InZNZOut%
Burger% found% out% that% Sehwani,% Incorporated% had% already%
$
obtained% Trademark% Registration% for% the% mark% “IN% N% OUT% (the%
inside%of%the%letter%“O”%formed%like%a%star).”%Also%in%2000,%InZNZOut%
Burger%sent%a%demand%letter%directing%Sehwani,%Inc.%to%cease%and%
desist% from% claiming% ownership% of% the% mark% “INZNZOUT”% and% to%
voluntarily%cancel%its%trademark%registration.%Sehwani%Inc.%did%not%
accede% to% InZNZOut% Burger’s% demand% but% it% expressed% its%
willingness%to%surrender%its%registration%for%a%consideration.%
In%2001%InZNZOut%Burger%filed%before%the%Bureau%of%Legal%Affairs%
an%administrative%complaint%against%the%Sehwani,%Inc.%and%Benita%
Frites,% Inc.% for% unfair% competition% and% cancellation% of% trademark%
registration.%
ISSUES:%
•% Whether!or!not!there!was!unfair!competition/!Whether!
or! not! a! ground! exists! for! the! cancellation! of!
registration!
•% Whether% or% not% the% Intellectual% Property% Office% (an%
administrative% body)% have% jurisdiction% of% cases% involving%
provisions%of%the%IPC%(e.g.%unfair%competition)%
•% Whether%or%not%the%Respondent%has%the%legal%capacity%to%
sue%for%the%protection%of%its%trademarks%albeit%it%is%not%
doing%business%in%the%Philippines%
HELD:%
%%
FIRST!ISSUE:!!
Yes.%Section%151(b)%of%RA%8293%provides%that%a%petition%to%cancel%
a% registration% of% a% mark% may% be% filed% with% the% Bureau% of% Legal%
Affairs%by%any%person%who%believes%that%he%is%or%will%be%damaged%
by%the%registration%of%a%mark%at%any%time,%if%the%registered%mark%
becomes%the%generic%name%for%the%goods%or%services,%or%a%portion%
thereof,%for%which%it%is%registered,%or%has%been%abandoned,%or%its%
registration%was%fraudulently%or%contrary%to%the%provisions%of%this%
Act,% or% if% the% registered% mark% is% being% used% by% or% with% the%
permission%of,%the%registrant%so%as%to%misrepresent%the%source%of%
goods% or% services% on% or% in% connection% with% which% the% mark% is%
used.%%The%evidence%showed%that%not%only%did%the%petitioners%
use% the% IN>N>OUT% Burger% trademark% for% the% name% of% their%
restaurant,% but% they% also% used% identical% or% confusingly%
similar%mark%for%their%hamburger%wrappers%and%French>fries%
receptacles,%thereby%effectively%misrepresenting%the%source%
of% the% goods% and% services.% It% showed% that% Sehwani% Inc.% and%
Benita%Frites%were%not%using%their%registered%trademark%but%that%of%
InZnZOut%Burger.%Sehwani%and%Benita%Frites%are%also%giving%their%
products%the%general%appearance%that%would%likely%influence%the%
purchasers% to% believe% that% their% products% are% that% of% InZNZOut%
Burger.% The% intention% to% deceive% may% be% inferred% from% the%
similarity%of%the%goods%as%packed%and%offered%for%sale,%and,%thus,%
an%action%will%lie%to%restrain%unfair%competition.%The%respondents’%
fraudulent% intention% to% deceive% purchasers% is% also% apparent% in%
their%use%of%the%InZNZOut%Burger%in%business%signages.%
%
The%essential%elements%of%an%action%for%unfair%competition%are%(1)%
confusing%similarity%in%the%general%appearance%of%the%goods%and%
(2)% intent% to% deceive% the% public% and% defraud% a% competitor.% The%
confusing%similarity%may%or%may%not%result%from%similarity%in%the%
marks,%but%may%result%from%other%external%factors%in%the%packaging%
or%presentation%of%the%goods.%The%intent%to%deceive%and%defraud%
may%be%inferred%from%the%similarity%of%the%appearance%of%the%goods%
as%offered%for%sale%to%the%public.%Actual%fraudulent%intent%need%not%
be%shown.%
SECOND%ISSUE:%
$
FIRST%ISSUE:%%
Yes,% the% IPO% (an% administrative% body)% has% jurisdiction% in% cases%
involving%provisions%of%the%IPC%(e.g.%unfair%competition)%due%to%the%
following%reasons:%
•% Section% 10% of% the% Intellectual% Property% Code%
specifically% identifies% the% functions% of% the% Bureau% of%
Legal%Affairs,%thus:%
% •% While% Section% 163% thereof% vests% in% civil% courts%
Section% 10.% The" Bureau" of" Legal" Affairs.“The% Bureau% of% Legal%
Affairs%shall%have%the%following%functions:%
10.1% Hear% and% decide% opposition% to% the% application% for%
registration%of%marks`%cancellation%of%trademarks`%subject%to%the%
provisions% of% Section% 64,% cancellation% of% patents% and% utility%
models,% and% industrial% designs`% and% petitions% for% compulsory%
licensing%of%patents`%
10.2% (a)% Exercise% original% jurisdiction% in% administrative%
complaints% for% violations% of% laws% involving% intellectual%
property% rightsf% Provided,% That% its% jurisdiction% is% limited% to%
complaints% where% the% total% damages% claimed% are% not% less%
than% Two% hundred% thousand% pesos%
(P200,000):% Provided,% futher,% That% availment% of% the%
provisional%remedies%may%be%granted%in%accordance%with%the%
Rules%of%Court.%Xxx%
Xxx%
(vi)% The% cancellation% of% any% permit,% license,% authority,% or%
registration%which%may%have%been%granted%by%the%Office,%or%
the%suspension%of%the%validity%thereof%for%such%period%of%time%as%
the% Director% of% Legal% Affairs% may% deem% reasonable% which% shall%
not%exceed%one%(1)%year`%
Xxx%
(viii)%The%assessment%of%damages`%
Unquestionably,% petitioner’s% complaint,% which% seeks% the%
cancellation%of%the%disputed%mark%in%the%name%of%respondent%
Sehwani,% Incorporated,% and% damages% for% violation% of%
petitioner’s% intellectual% property% rights,% falls% within% the%
jurisdiction%of%the%IPO%Director%of%Legal%Affairs.%
%%
jurisdiction%over%cases%of%unfair%competition,%nothing%
in%the%said%section%states%that%the%regular%courts%have%
sole%jurisdiction%over%unfair%competition%cases,%to%the%
exclusion%of%administrative%bodies.%
•% Sections%160%and%170,%which%are%also%found%under%Part%
III% of% the% Intellectual% Property% Code,% recognize% the%
concurrent%jurisdiction%of%civil%courts%and%the%IPO%over%
unfair%competition%cases.%
%
These%two%provisions%read:%%
Section% 160.% Right! of! Foreign! Corporation! to! Sue! in!
Trademark!or!Service!Mark!Enforcement!Action.%Any%foreign%
national% or% juridical% person% who% meets% the% requirements% of%
Section% 3% of% this% Act% and% does% not% engage% in% business% in% the%
Philippines%may%bring%a%civil%or%administrative%action%hereunder%
for% opposition,% cancellation,% infringement,% unfair% competition,% or%
false%designation%of%origin%and%false%description,%whether%or%not%it%
is%licensed%to%do%business%in%the%Philippines%under%existing%laws.%
Section% 170.% Penalties.% Independent% of% the% civil%
and% administrative% sanctions% imposed% by% law,% a% criminal%
penalty%of%imprisonment%from%two%(2)%years%to%five%(5)%years%and%
a% fine% ranging% from% Fifty% thousand% pesos% (P50,000)% to% Two%
$
hundred% thousand% pesos% (P200,000),% shall% be% imposed% on% any%
person% who% is% found% guilty% of% committing% any% of% the% acts%
mentioned%in%Section%155,%Section168,%and%Subsection169.1.%
%
Based%on%the%foregoing%discussion,%the%IPO%Director%of%Legal%
Affairs% had% jurisdiction% to% decide% the% petitioner’s%
administrative% case% against% respondents% and% the% IPO%
Director%General%had%exclusive%jurisdiction%over%the%appeal%
of%the%judgment%of%the%IPO%Director%of%Legal%Affairs.%
%
THIRD%ISSUE:%
Yes.%Section%160%RA%No.%8293%provides%for%the%right%of%foreign%
corporations% to% sue% in% trademark% or% service% mark% enforcement%
action,%provided%that%it%meets%the%requirements%under%Section%3%
thereof,%which%are:%
a.% Any% convention,% treaty% or% agreement% relation% to%
intellectual% property% right% or% the% repression% of% unfair%
competition%wherein%Philippines%is%also%a%party`%and%
b.% An%extension%therein%of%reciprocal%rights.%
Moreoever,%Article%6bis%of%The%Paris%Convention,%which%governs%
the% protection% of% wellZknown% trademarks,% is% a% selfZexecuting%
provision% and% does% not% require% legislative% enactment% to% give% it%
effect%in%the%member%country.%%The%essential%requirement%therein%
is% that% the% trademark% must% be% wellZknown% in% the% country% where%
protection% is% sought.% % In% this% case,% Director% BeltranZAbelardo%
found%that%InZnZout%Burger%and%Arrow%Design%is%an%internationally%
well0known% mark% as% evidenced% by% its% trademark% registrations%
around%the%world%and%its%comprehensive%advertisements%therein.%

%
$
Coca%Cola%v.%Gomez,%%
G.R.%No.%154491,%November%14,%2008%
Ponente:%Dela%Cruz,%J.%
% Section"168"in"its"entirety"states:"
% "
DOCTRINE%
From%jurisprudence,%unfair%competition%has%been%defined%as%the%
passing%off%(or%palming%off)%or%attempting%to%pass%off%upon%the%
public%the%goods%or%business%of%one%person%as%the%goods%or%
business%of%another%with%the%end%and%probable%effect%of%
deceiving%the%public.%It%formulated%the%"true%test"%of%unfair%
competition:%whether%the%acts%of%defendant%are%such%as%are%
calculated%to%deceive%the%ordinary%buyer%making%his%purchases%
under%the%ordinary%conditions%which%prevail%in%the%particular%
trade%to%which%the%controversy%relates.%One%of%the%essential%
requisites%in%an%action%to%restrain%unfair%competition%is%proof%of%
fraud`%the%intent%to%deceive%must%be%shown%before%the%right%to%
recover%can%exist.%Deception,"passing"off%and%fraud"upon"the"
public%are%still%the%key%elements%that%must%be%present%for%unfair%
competition%to%exist.%
% shall"be"subject"to"an"action"therefor."
FACTS%
On%July%2,%2001,%CocaZCola%applied%for%a%search%warrant%against%
Pepsi%for%hoarding%Coke%empty%bottles%in%Pepsi's%yard%in%
Concepcion%Grande,%Naga%City,%an%act%allegedly%penalized%as%
unfair%competition%under%the%IP%Code.%MTC%issued%%a%search%
warrant%to%seize%the%said%bottles.%The%local%police%seized%and%
brought%to%the%MTC's%custody%2,464%Litro%and%4,036%eight%and%
12%ounces%empty%Coke%bottles,%205%Pepsi%shells%for%Litro,%and%
168%Pepsi%shells%for%smaller%(eight%and%12%ounces)%empty%Coke%
bottles,%and%later%filed%with%the%Office%of%the%City%Prosecutor%of%
Naga%a%complaint%against%two%Pepsi%officers%for%violation%of%
Section%168.3%(c)%in%relation%to%Section%170%of%the%IP%Code.%%
%
SECTION"168."Unfair"Competition,"Rights,"Regulation"and"
Remedies."U"
168.1."A"person"who"has"identified"in"the"mind"of"the"public"the"
goods"he"manufactures"or"deals"in,"his"business"or"services"
from"those"of"others,"whether"or"not"a"registered"mark"is"
employed,"has"a"property"right"in"the"goodwill"of"the"said"goods,"
business"or"services"so"identified,"which"will"be"protected"in"the"
same"manner"as"other"property"rights."
"
168.2."Any"person"who"shall"employ"deception"or"any"other"
means"contrary"to"good"faith"by"which"he"shall"pass"off"the"
goods"manufactured"by"him"or"in"which"he"deals,"or"his"
business,"or"services"for"those"of"the"one"having"established"
such"goodwill,"or"who"shall"commit"any"acts"calculated"to"
produce"said"result,"shall"be"guilty"of"unfair"competition,"and"
"
168.3."In"particular,"and"without"in"any"way"limiting"the"scope"of"
protection"against"unfair"competition,"the"following"shall"be"
deemed"guilty"of"unfair"competition:"
"
(a)"Any"person,"who"is"selling"his"goods"and"gives"them"the"
general"appearance"of"goods"of"another"manufacturer"or"dealer,"
either"as"to"the"goods"themselves"or"in"the"wrapping"of"the"
packages"in"which"they"are"contained,"or"the"devices"or"words"
thereon,"or"in"any"other"feature"of"their"appearance,"which"
would"be"likely"to"influence"purchasers"to"believe"that"the"goods"
$
offered"are"those"of"a"manufacturer"or"dealer,"other"than"the" %
actual"manufacturer"or"dealer,"or"who"otherwise"clothes"the" ISSUE%
goods"with"such"appearance"as"shall"deceive"the"public"and" WON%there%was%unfair%competition%
defraud"another"of"his"legitimate"trade,"or"any"subsequent" %
vendor"of"such"goods"or"any"agent"of"any"vendor"engaged"in" HELD%
selling"such"goods"with"a"like"purposef" No.%
" %
(b)"Any"person"who"by"any"artifice,"or"device,"or"who"employs" Articles%168.1%and%168.2,%as%quoted%above,%provide%the%concept%
any"other"means"calculated"to"induce"the"false"belief"that"such" and%general%rule%on%the%definition%of%unfair%competition.%The%law%
person"is"offering"the"services"of"another"who"has"identified" does%not%thereby%cover%every!unfair!act!committed!in!the!
such"services"in"the"mind"of"the"publicf"or" course!of!businessf%it%covers%only%acts%characterized%by%
" "deception%or%any%other%means%contrary%to%good%faith"%in%
(c)"Any"person"who"shall"make"any"false"statement"in"the" the%passing!off%of%goods%and%services%as%those%of%another%
course"of"trade"or"who"shall"commit"any"other"act"contrary"to" who%has%established%goodwill%in%relation%with%these%goods%
good"faith"of"a"nature"calculated"to"discredit"the"goods," or%services,%or%any%other%act%calculated%to%produce%the%
business"or"services"of"another." same%result.%
% %
Petitioner%insists%that%Galicia%and%Gomez’s%acts%are%covered%by% From%jurisprudence,%unfair%competition%has%been%defined%as%the%
par%(c)%of%168.3.% passing%off%(or%palming%off)%or%attempting%to%pass%off%upon%the%
% public%the%goods%or%business%of%one%person%as%the%goods%or%
In%their%counterZaffidavits,%Galicia%and%Gomez%claimed%that%the% business%of%another%with%the%end%and%probable%effect%of%
bottles%came%from%various%Pepsi%retailers%and%wholesalers%who% deceiving%the%public.%It%formulated%the%"true%test"%of%unfair%
included%them%in%their%return%to%make%up%for%shortages%of%empty% competition:%whether%the%acts%of%defendant%are%such%as%are%
Pepsi%bottles`%and%that%they%did%not%know%that%the%possession%of% calculated%to%deceive%the%ordinary%buyer%making%his%purchases%
such%was%a%crime.%They%then%filed%motions%for%the%return%of%their% under%the%ordinary%conditions%which%prevail%in%the%particular%
shells%and%to%quash%the%search%warrant.%% trade%to%which%the%controversy%relates.%One%of%the%essential%
% requisites%in%an%action%to%restrain%unfair%competition%is%proof%of%
MTC:%denied%both% fraud`%the%intent%to%deceive%must%be%shown%before%the%right%to%
RTC%voided%the%warrant%for%lack%of%probable%cause%and%the%nonZ recover%can%exist.%Deception,"passing"off%and%fraud"upon"the"
commission%of%the%crime%of%unfair%competition,%even%as%it%implied% public%are%still%the%key%elements%that%must%be%present%for%unfair%
that%other%laws%may%have%been%violated%by%the%respondents% competition%to%exist.%
Petitioner%filed%a%petition%for%certiorari.% %
$
Section%168.3(c)%provides%the%general%"catchZall"%phrase%that%the% %
petitioner%cites.%Under%this%phrase,%a%person%shall%be%guilty%of%
unfair%competition%"who%shall%commit%any%other%act%contrary%to% %
good%faith%of%a%nature%calculated%to%discredit%the%goods,% %
business%or%services%of%another."%
he%act%alleged%to%violate%the%petitioner's%rights%under%Section% Torres%v.%Perez,%%
168.3%(c)%is%hoarding.%What%is%critical%for%purposes%of%Section% G.R.%Nos.%188225%and%198728f%November%28%2012%
168.3%(c)%is%to%determine%if%the%hoarding,%as%charged,%"is%of%a% SERENO,%CJ."
nature%calculated%to%discredit%the%goods,%business%or%services"%of% %
the%petitioner.%The%Court%holds%it%is%not.%It%does%not%relate%to%any% FACTS%
patent,%trademark,%trade%name%or%service%mark%that%the%
Shirley% Torres% and% her% daughter,% Sunshine,% formed% Sasay’s%
respondents%have%invaded,%intruded%into%or%used%without%proper%
Closet% Co.% (SCC),% a% partnership% registered% with% the% SEC.% SCC%
authority%from%the%petitioner.%Nor%are%the%respondents%alleged%to%
was%engaged%in%the%supply,%trading,%retailing%of%garments%such%as%
be%fraudulently%"passing%off"%their%products%or%services%as%those%
underwear,%children’s%wear,%women’s%and%men’s%wear,%and%other%
of%the%petitioner.%
incidental%activities%related%thereto.%
%
For% its% products,% SCC% used% the% trademark% "Naturals% with%
%
Design,"%which%it%filed%with%the%Intellectual%Property%Office%on%24%
% August%2005%and%registered%on%26%February%2007.%

% Sunshine%pulled%out%of%the%partnership%and%respondent%Imelda%
took%over%Sunshine’s%responsibilities%in%the%partnership.%
%
Due% to% disagreements,% Imelda% then% informed% Shirley% of% her%
% decision% to% dissolve% the% partnership.% Despite% the% objections% of%
% Shirley%to%the%dissolution,%various%amounts%were%paid,%by%Imelda,%
to%Shirley%representing%her%share%in%the%partnership%assets.%
%
Shirley% established% Tezares% Enterprise,% a% sole% proprietorship%
% engaged% in% supplying% and% trading% of% clothing% and% accessories%
except% footwear.% Shirley% discovered% that% underwear% products%
% bearing% the% brand% "Naturals"% were% being% sold% in% SM% with% the%
%
$
vendor%code%registered%to%RGP%Footwear%Manufacturing,%owned%
by%Imelda%and%her%husband.%

Shirley%filed%a%criminal%complaint%for%unfair%competition%against%
respondents%and%Sunshine.%%

ISSUE%

Whether%or%not%respondents%are%guilty%of%unfair%competition.%

HELD%

No.%
%%
Respondents% have% completed% the% payments% of% the% share% of%
Shirley%in%the%partnership%affairs.%Having%bought%her%out%of%SCC,%
respondents%were%already%its%exclusive%owners%who,%as%such,%had%
the%right%to%use%the%"Naturals"%brand.%
%
The%use%of%the%vendor%code%of%RGP%was%resorted%to%only%for%the%
practical% purpose% of% ensuring% that% SM’s% payments% for% the%
"Naturals"% products% would% go% to% respondents,% who% were% the%
actual%suppliers.%
%
Furthermore,% even% if% we% were% to% assume% that% the% issue% of%
protection%of%intellectual%property%is%paramount%in%this%case,%the%
criminal% complaint% for% unfair% competition% against% respondents%
cannot%prosper,%for%the%elements%of%the%crime%were%not%present.%%
%
We%have%enunciated%in%CCBPI%v.%Gomez%%that%the%key%elements%
of%unfair%competition%are%"deception,%passing%off%and%fraud%upon%
the%public."%No%deception%can%be%imagined%to%have%been%foisted%
on%the%public%through%different%vendor%codes,%which%are%used%by%
SM%only%for%the%identification%of%suppliers’%products.%
$
Sy%v.%CA%113%SCRA%334% % •% However,%Judge%Caguioa%held%that%since%Sy%
was% aware% that% the% imitation% pumps% bear% the% registered%
% trademark%of%Sea%Commercial%Co.,%Inc.%and%that%they%are%
% not% the% same% as% the% hand% pumps% described% in% the%
brochures% of% King% Brothers% Corporation,% Sy% should% be%
Facts:% prosecuted%for%the%crime%of%substituting%trademarks%under%
article%188(2)%of%the%Revised%Penal%Code.%%Hence,%Judge%
% •% Sea% Commercial% Co.,% Inc.,% a% domestic%
Caguioa%ordered%Provincial%Fiscal%(now%CFI%Judge)%Pedro%
corporation,% has% a% duly% registered% trademark% for% water%
D.%Ofiana%to%file%the%corresponding%information%against%Sy.%
pumps%known%as%Jetmatic.%At%the%same%time,%it%is%the%local%
In% compliance% with% that% directive,% Fiscal% Ofiana% in% an%
distributor%of%the%water%pumps%manufactured%by%Kawamoto%
information% dated% June% 1,% 1972% charged% Sy% with% selling%
Pump%Manufacturing%Co.,%Ltd.%of%Nagoya,%Japan%under%the%
hand% pumps% with% the% knowledge% that% the% trademark%
trademark% Dragon% which% is% duly% registered% with% the%
„Jetmatic% Dragon% Hand% Pump‰% had% been% fraudulently%
Philippine%Patent%Office.%
used% on% them% to% the% damage% and% prejudice% of% Sea%
% •% Sea%Commercial%Co.,%Inc.%sells%water%pumps% Commercial%Co.,%Inc.%
under%the%trademark%Jetmatic%Dragon,%a%combination%of%its%
% •% To% the% above% information,% petitioner% filed% a%
trademark%and%the%trademark%of%its%Japanese%principal.%At%
motion% to% quash% alleging% that% it% did% not% conform% to% the%
the% instance% of% Sea% Commercial% Co.,% Inc.,% agents% of% the%
prescribed%form`%that%the%Court%had%no%jurisdiction%over%the%
National% Bureau% of% Investigation% raided% Manuel% SyÊs%
case%because%no%preliminary%investigation%was%conducted,%
warehouse% at% 380% Gapan% Street,% Tondo,% Manila% and%
thereby% depriving% accused% of% due% process`% and% that% the%
seized% 274% water% pumps.% Sy% admitted% ownership% of% the%
new%information%would%place%accused%in%double%jeopardy.%
pumps%and%his%sales%of%that%merchandise.%
As%already%stated,%this%motion%was%denied.%
% •% Judge%Caguioa%concluded%that%because%the%
%
prosecution%had%not%proven%that%Sy%was%the%manufacturer%
of%the%imitation%pumps%or%that%he%was%the%one%responsible% Issue:%
for%giving%to%the%imitation%pumps%the%same%appearance%as%
the% water% pumps% of% Sea% Commercial% Co.,% Inc.,% he% could% 1.% WON% the% new% information% would% place% accused% in% double%
not% be% held% liable% for% unfair% competition% under% article% jeopardy.%
189(1)%of%the%Revised%Penal%Code.% 2.%WON%the%court%may%grant%another%preliminary%investigation%

%
$
Held:%% been%rendered%acquitting%the%accused,%while%the%Rules%of%Court%
cited%speaks%of%before%judgment.%But%as%already%intimated,%as%to%
1.%No% the%offense%of%infringement%of%trademark,%which%petitioner%himself%
In% the% opinion% of% the% trial% court,% the% first% information% did% not% contends% was% also% charged% in% the% first% information,% the% Court%
properly%charge%the%offense%of%infringement%of%trademark,%for%what% rendered%no%judgment%yet,%either%for%acquittal%or%for%conviction,%as%
was%expressly%charged%was%unfair%competition.%In%proceeding%in% it%appeared%to%the%trial%judge%that%the%accused%cannot%properly%be%
accordance% with% the% above% quoted% provisions% of% the% Rules% of% convicted%for%said%offense,%even%if%conviction%was%warranted%by%
Court,%the%trial%court%evidently%felt%it%can%not%properly%convict%the% the% evidence,% a% mistake% having% been% made,% as% he% read% the%
accused%of%infringement%of%trademark,%although%it%found%evidence% information,%and%with%reason,%in%charging%the%proper%offense.%
sufficient%to%justify%filing%the%proper%information%for%said%offense.%
However,%if%petitioner%insists%on%another%preliminary%investigation,%
But,% undoubtedly,% the% court% found% it% not% proper% to% acquit% the%
the%same%may%be%granted%by%way%of%reinvestigation,%the%Solicitor%
accused%of%said%offense.%Hence%there%can%be%no%double%jeopardy%
General% who% actually% represents% also% the% prosecution% having%
as%to%the%offense%charged%in%the%second%information%on%the%ground%
expressed%conformity%to%the%holding%of%one.%Let%it%not%be%said%that%
of%a%prior%acquittal%for%the%same%offense.%
We%are%not%mindful%of%the%rule%that%all%doubts%should%be%resolved%
It%is,%therefore,%absolutely%correct%to%hold%that%there%is%on%the%basis% in% favor% of% the% accused,% a% rule% which% itself% should% be% liberally%
of% the% facts% as% stated% above,% no% double% jeopardy% even% on% the% construed%in%his%favor.%
premise% that,% registration% is% not% an% essential% element% of% the%
%
offense% charged% in% the% second% information% as% contended% by%
petitioner.% It% becomes% more% so% if% registration% is% a% necessary%
element%as%submitted%by%the%Solicitor%General%with%whom%We%are%
inclined%to%agree,%although%an%express%ruling%on%the%matter%need%
no%longer%be%made%for%not%being%material%nor%decisive.%

2.%Yes%

What%evidently%led%the%Solicitor%General%to%give%his%conformity%to%
the% stand% taken% by% petitioner% as% to% the% necessity% of% a% new%
preliminary%investigation%is%his%belief%that,%judgment%has%already%
$
202)%SAMSON%v.%JUDGE%DAWAY% %
Topic:%RemediesZ%Criminal%(Sec.%170)% Petitioner%filed%a%twin%motion%to%quash%the%information%and%MR%of%
% the%order%denying%motion%to%suspend,%challenging%the%
FACTS:% jurisdiction%of%the%RTC,%contending%that%since%under%Sec.%170%of%
Manolo%Samson%was%the%owner/proprietor%of%ITTI%shoes/Mano% IPC,%the%penalty%of%imprisonment%for%unfair%competition%does%not%
Shoes%Manufacturing%Corporation%located%at%Robinsons% exceed%6%years,%the%offense%is%cognizable%by%the%MTC%and%not%
Galleria.% by%RTC,%per%RA%7691%%
% "%DENIED%
CATERPILLAR%INC.,%is%the%prior%adopter,%user,%and%owner%of% %
the%following%internationally:%CATERPILLAR,%CAT,% Petitioner%Samson%filed%MR%"%DENIED%
CATERPILLAR%&%DESIGN,%CAT%AND%DESIGN,%WALKING% Petitioner%filed%this%instant%petition%of%certiorari%alleging%that%
MACHINES,%and%TRACKZTYPE%TRACTOR%&%DESIGN.% respondent%Judge%Daway%gravely%abused%its%discretion%in%
% issuing%the%assailed%orders.%
It%was%alleged%that%Samson%distributed,%sold,%and/or%offer%for% %
sale%CATERPILLAR%products%such%as%footwear,%garments,% ISSUE:%WON%the%RTC%has%jurisdiction%over%the%caseZ%YES%
clothing,%bags,%accessories,%and%paraphernalia%which%are% %
closely%identical%to%and/or%colorable%imitations%of%the%authentic% RULING:%
Caterpillar%products%and%likewise%used%trademarks,%symbols,% ZUnder%Section%170%of%the%IPC,%the%criminal%penalty%for%
and/or%designs%as%would%cause%confusion,%mistake,%or%deception% infringement%of%registered%marks,%unfair%competition,%false%
on%the%part%of%the%buying%public%to%the%damage%and%prejudice%of% designation%of%origin%and%false%description%or%representation,%is%
CATERPILLAR,%INC.%% imprisonment%from%2%to%5%years%and%a%fine%ranging%from%P50kZ
% P200K%
2%information%for%unfair%competition%under%Sec.%168.3(a)%in% %
relation%to%Sec.%170%of%the%IPC%were%filed%against%petitioner% ZCorollarily,%Section%163%of%the%same%Code%states%that%actions%
Manolo%Samson,%the%registered%owner%of%ITTI%shoes.% (including%criminal%and%civil)%under%Sections%150,%155,%164,%166,%
% 167,%168%and%169%shall%be%brought%before%the%proper%courts%with%
Petitioner%filed%a%motion%to%suspend%arraignment%and%other% appropriate%jurisdiction%under%existing%laws%
proceedings%in%view%of%the%existence%of%the%alleged%prejudicial% %
question%involved%for%unfair%competition%and%also%in%view%of%the% ZThe%existing%law%referred%to%in%the%foregoing%provision%is%Section%
pendency%of%a%petition%for%review%filed%with%the%Sec%of%Justice% 27%of%R.A.%No.%166%(The%Trademark%Law)%which%provides%that%
assailing%the%resolution%finding%probable%cause%to%charge%petition% jurisdiction%over%cases%for%infringement%of%registered%marks,%
with%unfair%competition%"%DENIED%
$
unfair%competition,%false%designation%of%origin%and%false%
description%or%representation,%is%lodged%with%the%RTC%
%
ZThe%repealing%clause2%of%IPC%did%not%expressly%repeal%RA%166%
in%its%entirety,%otherwise,%it%would%not%have%used%the%phrases%
“parts%of%Acts%and%inconsistent%herewith”%
ZMoreover,%the%settled%rule%in%statutory%construction%is%that%in%
case%of%conflict%between%a%general%law%and%a%special%law,%the%
latter%must%prevail%"%jurisdiction%conferred%by%a%special%law%to%
Regional%Trial%Courts%must%prevail%over%that%granted%by%a%
general%law%to%Municipal%Trial%Courts%
%
ZIn%the%case%at%bar,%IPC%(R.A.%No.%8293)%and%the%Trademark%Law%
(R.A.%No.%166)%are%special%laws%conferring%jurisdiction%over%
violations%of%intellectual%property%rights%to%the%Regional%Trial%
Court%"%they%should%therefore%prevail%over%R.A.%No.%7691,%which%
is%a%general%law%
%
ZHence,%jurisdiction%over%the%instant%criminal%case%for%unfair%
competition%is%properly%lodged%with%the%Regional%Trial%Court%
even%if%the%penalty%therefor%is%imprisonment%of%less%than%6%years,%
or%from%2%to%5%years%and%a%fine%ranging%from%P50kZP200k%
%
WHEREFORE,%petition%is%DISMISSED.%
Winner:%Respondent%Judge%Daway%
%
%

2%SEC.%239.%Repeals.%239.1.%All%Acts%and%parts%of%Acts%inconsistent%herewith,%more% including%Presidential%Decree%No.%285,%as%amended,%are%hereby%repealed.%(Emphasis%
particularly%Republic%Act%No.%165,%as%amended`%Republic%Act%No.%166,%as%amended`% added)%
and%Articles%188%and%189%of%the%Revised%Penal%Code`%Presidential%Decree%No.%49,%
$
% the% Economic% Intelligence% and% Investigation% Bureau% (EIIB),%
Gemma%Ong%AKA%Maria%Teresa%Gemma%Catacutan%v%People%
of%the%Philippines%
G.R.%No.%169440%Novembre%23,%2011%
Ponente:%LeonardoZDe%Castro,%J.%
% Quiapo,% Manila.% A% mission% team% formed% by% EIIB,% including%
DOCTRINE%
A% mark% is% any% visible% sign% capable% of% distinguishing% the% goods%
(trademark)%or%services%(service%mark)%of%an%enterprise%and%shall%
include%a%stamped%or%marked%container%of%goods.%
% samples%of%Marlboro%cigarettes%sold%therein.%
FACTS%
•% Gemma% Ong% a.k.a.% Maria% Teresa% Gemma% Catacutan%
(Gemma)%was%charged%before%the%RTC%for%Infringement%under%
Section% 155% in% relation% to% Section% 170% of% Republic% Act% No.%
8293%or%the%Intellectual%Property%Code.%
•% On%%September%25,%1998%at%Sta.%Cruz,%Gemma%Ong%did%then%
and%there,%knowingly,%maliciously,%unlawfully%and%feloniously%
engage% in% the% distribution,% sale,% [and]% offering% for% sale% of%
counterfeit%Marlboro%cigarettes%which%had%caused%confusion,%
deceiving% the% public% that% such% cigarettes% [were]% Marlboro%
cigarettes%and%those%of%the%Telengtan%Brothers%and%Sons,%Inc.,%
doing% business% under% the% style% of% La% Suerte% Cigar% and%
Cigarettes% Factory,% the% exclusive% manufacturer% of% Marlboro%
Cigarette%in%the%Philippines%and%that%of%Philip%Morris%Products,%
Inc.% (PMP7)% the% registered% owner% and% proprietor% of% the%
MARLBORO% trademark% together% with% the% devices,% including%
the% famousZRoot% Device,% to% their% damage% and% prejudice,%
without% the% accused% seeking% their% permit% or% authority% to%
manufacture%and%distribute%the%same.%
•% On% September% 10,% 1998,% Jesse% S.% Lara,% then% Senior%
Investigator%III%at%the%Intellectual%Property%Rights%(IPR)%Unit%of%
Department% of% Finance,% received% reliable% information% that%
counterfeit% Marlboro% cigarettes% were% being% distributed% and%
sold% by% two% (2)% Chinese% nationals,% Johnny% Sia% and% Jessie%
Concepcion,%in%the%areas%of%Tondo,%Binondo,%Sta.%Cruz%and%
Lara,% conducted% surveillance% operation% to% verify% the% report.%
EIIB%agents%Leonardo%Villanueva%and%Jigo%Madrigal%did%a%testZ
buy% on% the% different% sariUsari% stores% of% Manila% located% in%
Quiapo,% Tondo,% Sta.% Cruz% and% Blumentritt% areas% and% took%
•% The%EIIB%team%coordinated%with%officers%of%Philip%Morris,%Inc.,%
owner%of%the%trademark%Marlboro%Label%in%the%Philippines%duly%
registered%with%the%Philippine%Patents%Office%and%subsequently%
with% the% Intellectual% Property% Office% (IPO)% since% 1956.% Initial%
examination% made% by% Philip% Morris,% Inc.% on% those% random%
sample% purchases% revealed% that% the% cigarettes% were% indeed%
fake% products% unauthorized% by% the% company.% With% official%
indorsement% by% the% EIIB,% Senior% Investigator% Lara% filed% an%
application%for%search%warrant%before%the%Regional%Trial%Court%
of% Dasmarias,% Cavite,% Branch% 90.% On% September% 24,% 1998,%
Executive%Judge%Dolores%L.%Espaol%issued%a%search%warrant%
after%finding%probable%cause%to%believe%that%Mr.%Jackson%Ong%
has%in%his%possession/control%in%the%premises%located%at%1675Z
1677% Bulacan% St.% cor.% M.% Hizon% St.,% Sta.% Cruz,% Manila,% the%
following%properties:%Substantial%number%of%fake%locally%made%
and% imported% fake% cigarettes% bearing% the% Marlboro% brand,%
together% with% the% corresponding% labels,% cartons,% boxes% and%
other% packaging% as% well% as% receipts,% invoices% and% other%
documents%relative%to%the%purchase,%sale,%and%distribution%of%
the%aforesaid%fake%Marlboro%cigarettes.%
$
•% %Gemma%denied%that%she%is%the%Gemma%Ong%accused%in%the%
case%and%she%showed%her%PRC%ID%to%show%that%she%is%a%dentist%
by% profession,% although% she% claimed% that% she% is% a%
businessperson%in%practice.%She%said%that%she%used%to%buy%and%
sell%gear%fabrics,%tZshirts,%truck%materials,%and%real%estate%under%
the% business% name% Fascinate% Trading% based% in% Bulacan%
Street,%Sta.%Cruz,%Manila,%but%that%it%had%ceased%operations%in%
February%1998.%Gemma%denied%ever%having%engaged%in%the%
manufacture%and%sale%of%any%kind%of%cigarettes%and%claimed%
that% she% could% not% even% distinguish% between% a% fake% and% a%
genuine%Marlboro%cigarette.%
•% RTC:%convicted%Gemma.%She%is%in%violation%of%Section%155%in%
relation%to%Section%170%of%RA%8293.%
“She%could%have%protested%at%the%time%of%her%
arrest% that% they% were% arresting% the% wrong%
person% but% this% she% did% not% do.% She%
proceeded%to%post%a%bond%for%her%provisional%
liberty,%hired%a%lawyer%to%defend%her%but%failed%
to% divulge% the% very% information% that% could%
have%led%to%an%early%dismissal%of%the%case,%if%
true.”%
•% CA:%The%Court%of%Appeals%affirmed%the%conviction%of%Gemma%
for%trademark%infringement%under%Section%155%of%Republic%Act%
No.%8293,%as%the%counterfeit%goods%seized%by%the%EIIB%were%
not%only%found%in%her%possession%and%control,%but%also%in%the%
building%registered%under%her%business,%Fascinate%Trading.%
%
ISSUE%
Whether% or% not% Gemma% is% guilty% of% violation% Section% 155% in%
relation%to%Section%170%of%RA%8293%
%
HELD%
YES.%In%McDonalds"Corporation"and"McGeorge"Food"Industries,"
Inc."v."L.C."Big"Mak"Burger,"Inc.,"this%Court%held:%
To% establish% trademark% infringement,% the%
following%elements%must%be%shown:%(1)%the%validity%
of%plaintiffs%mark`%(2)%the%plaintiffs%ownership%of%the%
mark`%and%(3)%the%use%of%the%mark%or%its%colorable%
imitation%by%the%alleged%infringer%results%in%likelihood%
of%confusion.%Of%these,%it%is%the%element%of%likelihood%
of% confusion% that% is% the% gravamen% of% trademark%
infringement.%%%
A% mark% is% valid% if% it% is% distinctive% and% not% barred% from%
registration.%Once%registered,%not%only%the%marks%validity,%but%also%
the%registrants%ownership%of%the%mark%is%prima"facie%presumed.%
The% prosecution% was% able% to% establish% that% the% trademark%
Marlboro% was% not% only% valid% for% being% neither% generic% nor%
descriptive,%it%was%also%exclusively%owned%by%PMPI,%as%evidenced%
by% the% certificates% of% registration% issued% by% the% Intellectual%
Property%Office%of%the%Department%of%Trade%and%Industry.%Anent%
the%element%of%confusion,%both%the%RTC%and%the%Court%of%Appeals%
have% correctly% held% that% the% counterfeit% cigarettes% seized% from%
Gemmas%possession%were%intended%to%confuse%and%deceive%the%
public% as% to% the% origin% of% the% cigarettes% intended% to% be% sold,% as%
they% not% only% bore% PMPIs% mark,% but% they% were% also% packaged%
almost%exactly%as%PMPIs%products.%
On%mistaken%identity:%
If%it%were%true%that%Gemma%was%not%at%the%subject%premises%at%all%
on% September% 25,% 1998,% then% she% should% have% grabbed% every%
chance%to%correct%this%notion%and%expose%this%mistake%before%she%
was%arrested.%She%could%have%brought%up%her%defense%of%mistaken%
$
identity% or% absence% at% the% raid% in% the% preliminary% investigation%
conducted% prior% to% the% issuance% of% her% warrant% of% arrest`% but%
instead,% she% chose% to% ignore% her% subpoena% and% disregard% the%
preliminary%investigation.%Even%then,%Gemma%had%the%opportunity%
to%raise%the%fact%that%she%was%not%Gemma%Ong`%not%only%during%
her%arrest,%but%also%during%the%posting%of%the%cash%bond%for%her%
bail,% and% more% importantly,% during% her% arraignment,% when% she%
was% asked% if% she% understood% the% charges% against% her.%
Gemma%also%knew%that%the%Information%was%filed%against%her%on%
the%basis%of%the%amended%affidavits,%thus,%she%could%have%filed%a%
motion%to%quash%the%information%before%she%entered%her%plea,%or%
asked% that% a% reinvestigation% be% conducted.% However,% all% these%
Gemma%failed%to%do.%
%
%

%
$
UYCO%VS%LO%
FACTS:%
•% The%disputed%marks%in%this%case%are%the%"HIPOLITO%&%SEA%
HORSE% &% TRIANGULAR% DEVICE,"% "FAMA,"% and% other%
related% marks,% service% marks% and% trade% names% of% Casa%
Hipolito%S.A.%Portugal%appearing%in%kerosene%burners.%%
•% Respondent% Vicente% Lo% and% Philippine% Burners%
Manufacturing% Corporation% (PBMC)% filed% a% complaint%
against% the% officers% of% Wintrade% Industrial% Sales%
Corporation% (Wintrade),% including% petitioners% Chester%
Uyco,% Winston% Uychiyong% and% Cherry% UycoZOng,% and% of%
National%Hardware,%including%Mario%Sy%Chua,%for%violation%
of%Section%169.1,%in%relation%to%Section%170,%of%RA%8293.%
•% Lo% claimed% in% his% complaint% that% GasirelZIndustria% de%
Comercio%e%Componentes%para%Gass,%Lda.%(Gasirel),%the%
owner% of% the% disputed% marks,% executed% a% deed% of%
assignment% transferring% these% marks% in% his% favor,% to% be%
used% in% all% countries% except% for% those% in% Europe% and%
America.%%
•% In% a% test% buy,% Lo% purchased% from% National% Hardware%
kerosene% burners% with% the% subject% marks% and% the%
designations%"Made%in%Portugal"%and%"Original%Portugal"%in%
the% wrappers.% These% products% were% manufactured% by%
Wintrade.% Lo% claimed% that% as% the% assignee% for% the%
trademarks,%he%had%not%authorized%Wintrade%to%use%these%
marks,%nor%had%Casa%Hipolito%S.A.%Portugal.%While%a%prior%
authority%was%given%to%Wintrade's%predecessorZinZinterest,%
Wonder% Project% &% Development% Corporation% (Wonder),%
Casa% Hipolito% S.A.% Portugal% had% already% revoked% this%
authority% through% a% letter% of% cancellation% dated% May% 31,%
1993.%%%
•% The% kerosene% burners% manufactured% by% Wintrade% have%
caused% confusion,% mistake% and% deception% on% the% part% of%
the% buying% public.% Lo% stated% that% the% real% and% genuine%
burners%are%those%manufactured%by%its%agent,%PBMC.%%
•% In% their% Answer,% the% petitioners% stated% that% they% are% the%
officers% of% Wintrade% which% owns% the% subject% trademarks%
and%their%variants.%To%prove%this%assertion,%they%submitted%
as% evidence% the% certificates% of% registration% with% the%
Intellectual%Property%Office.%They%alleged%that%Gasirel,%not%
Lo,%was%the%real%partyZinZinterest.%They%allegedly%derived%
their% authority% to% use% the% marks% from% Casa% Hipolito% S.A.%
Portugal%through%Wonder,%their%predecessorZinZinterest.%%
•% The% petitioners% pointed% out% that% Lo% failed% to% sufficiently%
prove% that% the% burners% bought% from% National% Hardware%
were%those%that%they%manufactured.%But%at%the%same%time,%
they% also% argued% that% the% marks% "Made% in% Portugal"% and%
"Original%Portugal"%are%merely%descriptive%and%refer%to%the%
source%of%the%design%and%the%history%of%manufacture.%
•% After% the% preliminary% investigation,% the% Chief% State%
Prosecutor%found%probable%cause%to%indict%the%petitioners%
for%violation%of%Section%169.1,%in%relation%with%Section%170,%
of% RA% 8293.% This% law% punishes% any% person% who% uses% in%
commerce%any%false%designation%of%origin%which%is%likely%to%
cause%confusion%or%mistake%as%to%the%origin%of%the%product.%
The%law%seeks%to%protect%the%public`%thus,%even%if%Lo%does%
not% have% the% legal% capacity% to% sue,% the% State% can% still%
prosecute%the%petitioners%to%prevent%damage%and%prejudice%
to%the%public%
•% Both% the% CA% and% the% DOJ% affirmed% and% found% probable%
cause% to% charge% the% petitioners% with% false% designation% of%
$
origin,%in%violation%of%Section%169.1,%in%relation%with%Section%
170,%of%Republic%Act%No.%(RA)%8293,%otherwise%known%as%
the%"Intellectual%Property%Code%of%the%Philippines."%%
ISSUE:%
WON%petitioners%are%guilty%of%false%designation%of%origin%(YES)%
The% argument% that% the% words% "Made% in% Portugal"% and% "Original%
Portugal"%refer%to%the%origin%of%the%design%and%not%to%the%origin%of%
the%goods%does%not%negate%the%finding%of%probable%cause`%at%the%
same%time,%it%is%an%argument%that%the%petitioners%are%not%barred%by%
this%Resolution%from%raising%as%a%defense%during%the%hearing%of%
the%case%

HELD:% %

The%admission%in%the%petitioners'%Joint%Affidavit%is%not%in%any%way%
hypothetical,% as% they% would% have% us% believe.% They% narrate%
incidents% that% have% happened.% They% refer% to% Wintrade's% former%
association%with%Casa%Hipolito%S.A.%Portugal`%to%their%decision%to%
produce%the%burners%in%the%Philippines`%to%their%use%of%the%disputed%
marks`%and%to%their%justification%for%their%use%

Chua,% the% owner% of% National% Hardware% —% the% place% where% the%
test% buy% was% conducted% —% admits% that% Wintrade% has% been%
furnishing% it% with% kerosene% burners% with% the% markings% "Made% in%
Portugal"%for%the%past%20%years%

the%evidence%shows%that%petitioners,%who%are%officers%of%Wintrade,%
placed%the%words%"Made%in%Portugal"%and%"Original%Portugal"%with%
the%disputed%marks%knowing%fully%well%—%because%of%their%previous%
dealings% with% the% Portuguese% company% —% that% these% were% the%
marks%used%in%the%products%of%Casa%Hipolito%S.A.%Portugal.%More%
importantly,% the% products% that% Wintrade% sold% were% admittedly%
produced%in%the%Philippines,%with%no%authority%from%Casa%Hipolito%
S.A.%Portugal.%The%law%on%trademarks%and%trade%names%precisely%
precludes% a% person% from% profiting% from% the% business% reputation%
built%by%another%and%from%deceiving%the%public%as%to%the%origins%of%
products.%
$
Victorio%P.%Diaz%vs%People%of%the%Philippines%and%Levi%Strauss%
(Phils.),%Inc.%
G.R.%No.%180677,%February%18,%2003%
% them%bearing%the%registered%trademarks,%like%the%arcuate%design,%
FACTS:% The% Department% of% Justice% filed% 2% Informations% in% the%
RTC%in%Las%Piñas%City%charging%Victorio%Diaz%with%violation%of%Sec.%
155,%in%relation%to%Sec.%179%of%R.A.%No.%8293%(Intellectual%Property%
Code)%for%infringement%of%the%registered%trademarks%particularly%
LEVI’S% 501% jeans.% Diaz% was% alleged% to% have% reproducted,%
counterfeited,% copied% and% colorably% imitated% Levi’s% registered%
trademarks%or%dominant%features%thereof%such%as%the%ARCUATE%
DESIGN,% TWO% HORSE% BRAND,% TWO% HORSE% PATCH,% TWO%
HORSE% LABEL% WITH% PATTERNED% ARCUATE% DESIGN,% TAB%
AND% COMPOSITE% ARCUATE/TAB/TWO% HORSE% PATCH% and%
sold,% offered% to% sale,% manufactured,% distributed% counterfeit%
patches%and%jeans,%including%other%preparatory%steps%necessary%
to% carry% out% the% sale% of% said% patches% and% jeans,% which% likely%
caused% confusion,% mistake,% and/or% deceived% the% general%
consuming%public,%without%the%consent,%permit%or%authority%of%the%
registered%owner,%Levi’s,%thus%depriving%and%defrauding%the%latter%
of%its%right%to%the%exclusive%use%of%its%trademarks%and%legitimate%
trade,%to%the%damage%and%prejudice%of%Levi’s.%
Levi% Strauss% Philippines,% Inc.% is% a% licensee% of% Levi’s.% After%
receiving%information%that%Diaz%was%selling%counterfeit%LEVI’S%501%
jeans%in%his%tailoring%shops%in%Almanza%and%Talon,%Las%Piñas%City,%
Levi’s%Philippines%hired%a%private%investigation%group%to%verify%the%
information.% Surveillance% and% the% purchase% of% jeans% from% the%
tailoring%shops%of%Diaz%established%that%the%jeans%bought%from%the%
tailoring% shops% of% Diaz% were% counterfeit% or% imitations% of% LEVI’S%
501.% Armed% with% search% warrants,% NBI% agents% searched% the%
tailoring%shops%of%Diaz%and%seized%several%fake%LEVI’S%501%jeans%
from%them.%Levi’s%Philippines%claimed%that%it%did%not%authorize%the%
making% and% selling% of% the% seized% jeans`% that% each% of% the% jeans%
were%colorable%imitations%of%genuine%LEVI’S%501%jeans%by%each%of%
the%tab,%and%the%leather%patch`%and%that%the%seized%jeans%could%be%
mistaken%for%original%LEVI’S%501%jeans%due%to%the%placement%of%
the%arcuate,%tab,%and%twoZhorse%leather%patch.%
On% his% part,% Diaz% admitted% being% the% owner% of% the% shops%
searched,%but%he%denied%any%criminal%liability.%Diaz%stated%that%he%
did%not%manufacture%Levi’s%jeans,%and%that%he%used%the%label%“LS%
Jeans%Tailoring”%in%the%jeans%that%he%made%and%sold`%that%the%label%
“LS%Jeans%Tailoring”%was%registered%with%the%Intellectual%Property%
Office`%that%his%shops%received%clothes%for%sewing%or%repair`%that%
his%shops%offered%madeZtoZorder%jeans,%whose%styles%or%designs%
were%done%in%accordance%with%instructions%of%the%customers`%that%
since% the% time% his% shops% began% operating% in% 1992,% he% had%
received%no%notice%or%warning%regarding%his%operations`%that%the%
jeans% he% produced% were% easily% recognizable% because% the% label%
“LS% Jeans% Tailoring,”% and% the% names% of% the% customers% were%
placed%inside%the%pockets,%and%each%of%the%jeans%had%an%“LSJT”%
red% tab`% that% “LS”% stood% for% “Latest% Style`”% and% that% the% leather%
patch%on%his%jeans%had%two%buffaloes,%not%two%horses.%
%
ISSUE/S:%Whether%there%exists%a%likelihood%of%confusion%between%
the%trademarks%of%Levi’s%and%Diaz.%(No.)%
%
RULING:%The%Court%held,%through%the%application%of%the%holistic%
test,% that% there% was% no% likelihood% of% confusion% between% the%
trademarks%involved.%Accordingly,%the%jeans%trademarks%of%Levi’s%
Philippines% and% Diaz% must% be% considered% as% a% whole% in%
determining% the% likelihood% of% confusion% between% them.% The%
$
maongpants%or%jeans%made%and%sold%by%Levi’s%Philippines,%which%
included%LEVI’S%501,%were%very%popular%in%the%Philippines.%The%
consuming%public%knew%that%the%original%LEVI’S%501%jeans%were%
under%a%foreign%brand%and%quite%expensive.%Such%jeans%could%be%
purchased%only%in%malls%or%boutiques%as%readyZtoZwear%items,%and%
were%not%available%in%tailoring%shops%like%those%of%Diaz’s%as%well%
as% not% acquired% on% a% “madeZtoZorder”% basis.% Under% the%
circumstances,%the%consuming%public%could%easily%discern%if%the%
jeans%were%original%or%fake%LEVI’S%501,%or%were%manufactured%by%
other%brands%of%jeans.%
% In%terms%of%classes%of%customers%and%channels%of%trade,%the%jeans%
Diaz%used%the%trademark%“LS%JEANS%TAILORING”%for%the%jeans%
he%produced%and%sold%in%his%tailoring%shops.%His%trademark%was%
visually%and%aurally%different%from%the%trademark%“LEVI%STRAUSS%
&% CO”% appearing% on% the% patch% of% original% jeans% under% the%
trademark%LEVI’S%501.%The%word%“LS”%could%not%be%confused%as%
a% derivative% from% “LEVI% STRAUSS”% by% virtue% of% the% “LS”% being%
connected%to%the%word%“TAILORING”,%thereby%openly%suggesting%
that% the% jeans% bearing% the% trademark% “LS% JEANS% TAILORING”%
came%or%were%bought%from%the%tailoring%shops%of%Diaz,%not%from%
the% malls% or% boutiques% selling% original% LEVI’S% 501% jeans% to% the%
consuming%public.%%
% allowed% the% registration% had% Diaz’s% trademark% been% confusingly%
The% prosecution% also% alleged% that% the% accused% copied% the% “two%
horse% design”% of% the% petitionerZprivate% complainant% but% the%
evidence%will%show%that%there%was%no%such%design%in%the%seized%
jeans.%Instead,%what%is%shown%is%“buffalo%design.”%Again,%a%horse%
%
and%a%buffalo%are%2%different%animals%which%an%ordinary%customer%
can%easily%distinguish.%%
%
The% prosecution% further% alleged% that% the% red% tab% was% copied% by%
the%accused.%However,%evidence%will%show%that%the%red%tab%used%
by%the%private%complainant%indicates%the%word%“LEVI’S”%while%that%
of% the% accused% indicates% the% letters% “LSJT”% which% means% LS%
JEANS% TAILORING.% Again,% even% an% ordinary% customer% can%
distinguish%the%word%LEVI’S%from%the%letters%LSJT.%
%
products% of% the% private% complainant% and% the% accused% cater% to%
different% classes% of% customers% and% flow% through% the% different%
channels%of%trade.%The%customers%of%the%private%complainant%are%
mall%goers%belonging%to%class%A%and%B%market%group%–%while%that%
of% the% accused% are% those% who% belong% to% class% D% and% E% market%
who%can%only%afford%Php%300.00%for%a%pair%of%madeZtoZorder%pants.%
%
Moreover,% based% on% the% certificate% issued% by% the% Intellectual%
Property% Office,% “LS% JEANS% TAILORING”% was% a% registered%
trademark%of%Diaz.%He%had%registered%his%trademark%prior%to%the%
filing%of%the%present%cases.%The%IPOPHL%would%certainly%not%have%
similar%with%the%registered%trademark%for%LEVI’s%“501”%jeans.%
%
Thus,% the% Supreme% Court% acquitted% as% there% is% no% likelihood% of%
confusion%between%the%expensive%boutique%brand%as%against%the%
locally%cheaper%customZmade%denims%of%the%supposed%copycat.%
$
206% Converse% Rubber% Corporation% vs.% Universal% Rubber%
Products,%Inc.%and%Tiburcio%S.%Evalle,%Director%of%Patents%
TOPIC:%Tradenames`%Definition%
PONENTE:%Fernan,%J:%
FACTS:%
•% Converse%Rubber%Corporation%is%an%American%corporation%
while% Universal% Rubber% Products,% Inc.% is% a% corporation%
licensed%to%do%business%in%the%country.%Converse%has%been%
operating%since%1946.%Universal%Rubber%has%been%selling%
sandals%since%1962%and%rubber%shoes%since%1963.%%
•% Universal% Rubber% filed% an% application% for% the% trademark%
“Universal% Converse% and% Device”% before% the% Philippine%
Patent%Office.%Converse%Rubber%opposed%as%it%averred%that%
the% word% “Converse”% which% is% part% of% its% corporate% name%
cannot%be%granted%as%part%of%Universal%Rubber’s%trademark%
or%trade%name%because%it%will%likely%deceive%the%purchasers.%
It%was%Petitioner’s%contention%that%Respondent’s%use%of%the%
word%“converse”%will%deceive%purchasers%and%cause%great%
and% irreparable% injury% to% the% business% reputation% and%
goodwill%of%the%Petitioner%in%the%Philippines.%
•% The%Director%of%Patents%dismissed%the%opposition%and%gave%
due% course% to% Respondent’s% application.% The% Director%
ruled%that%the%Petitioner%has%failed%to%prove%that%the%word%
“Converse”% has% become% so% identified% with% the% Petitioner%
that%whenever%used,%it%designates%to%the%mind%of%the%public%
that%particular%corporation.%
% Converse% Rubber,% and% is% in% fact% the% dominant% word% in% its%
ISSUE(S):%%%
1.% Whether%the%partial%appropriation%of%Petitioner’s%corporate%
name%is%of%such%character%that%is%calculated%to%deceive%or%
confuse%the%public.%
%
HELD:%%
YES%
%
RATIO:%
A% trade% name% is% any% individual% name% or% surname,% firm% name,%
device,%or%word%used%by%manufacturers,%industrialists,%merchants,%
and%others%to%identify%their%businesses,%vocations,%or%occupations.%
A%tradename%refers%to%the%business%and%the%goodwill,%while%the%
trademark%refers%to%the%goods.%
%
From%a%cursory%appreciation%of%the%Converse%Rubber’s%corporate%
name%“CONVERSE%RUBBER%CORPORATION”%it%is%evident%that%
the% word% “CONVERSE”% is% the% dominant% word% which% identifies%
Converse% Rubber% from% other% corporations% engaged% in% similar%
business.% Respondent,% in% the% stipulation% of% facts,% admitted%
Converse% Rubber’s% existence% since% 1946% as% a% duly% organized%
foreign%corporation%engaged%in%the%manufacture%of%rubber%shoes.%
This% admission% necessarily% betrays% its% knowledge% of% the%
reputation% and% business% of% petitioner% even% before% it% applied% for%
registration%of%the%trademark%in%question.%Knowing,%therefore,%that%
the% word% “CONVERSE”% belongs% to% and% is% being% used% by%
corporate%name,%Universal%Rubber%has%no%right%to%appropriate%the%
same% for% use% on% its% products% which% are% similar% to% those% being%
produced%by%Converse%Rubber.%
$
%
Further,%the%trademark%used%by%Respondent%is%confusingly%similar%
to%that%used%by%Petitioner%(the%name%placed%on%a%circular%base%on%
the% side% of% the% shoe).% The% determinative% factor% in% ascertaining%
whether%the%marks%are%confusingly%similar%is%not%that%it%is%actually%
used% to% confuse% or% deceive.% Rather,% it% is% sufficient% that% the%
possibility% or% likelihood% of% the% brands% being% mistaken% for% one%
another.%
%
Wherefore,% Respondent’s% application% for% registration% of% the%
trademark%is%denied.%
%
$
Title:% Philips%Export%v.%Court%of%Appeals%
% G.%R.%NO.%96161,%February%21,%1992,%MelencioZHerrera,%J.%
% documentary% evidence% presented,% it% cannot% order% the%
Doctrine:%An%owner%of%a%registered%mark%has%the%exclusive%right%
to%its%use%which%must%be%free%from%any%infringement%by%similarity.%
A%corporation%has%an%exclusive%right%to%the%use%of%its%name,%which%
may% be% protected% by% injunction% upon% a% principle% like% that% upon%
which% persons% are% protected% in% the% use% of% trademarks% and%
tradename.%
% Held:%%
Facts:%
•% Philips%Export%B.V.%(PEBV)%is%the%registered%owner%of%the%
trademarks% Philips% and% Philips% Shield% Emblem% under%
Certificates% of% Registration% issued% by% the% Bureau% of%
Patents,% Trademarks% and% Technology% Transfer.% Philips%
Electrical%Lamps,%Inc.%and%Philips%Industrial%Development,%
Inc.% are% authorized% users% of% the% trademarks% Philips% and%
Philips%Shield%Emblem.%
•% Standard% Philips% Corporation% was% issued% a% Certificate% of%
Registration%by%respondent%Commission%on%19%May%1982.%
•% PEBV% sought% the% cancellation% of% Standard% Philip’s%
trademark% and% the% issuance% of% a% writ% of% preliminary%
injunction.%%
•% Standard%questioned%its%legal%capacity%to%sue%and%alleged%
that% its% use% of% its% corporate% name% is% not% at% all% similar% to%
Petitioners’% trademark% PHILIPS% when% considered% in% its%
entirety`% and% that% its% products% consisting% of% chain% rollers,%
belts,%bearings%and%cutting%saw%are%grossly%different%from%
Petitioners’%electrical%products.%
•% SEC%Officer%denied%the%issuance%of%the%writ.%
•% SEC%en%Bank%affirmed%the%decision%of%the%officer.%
•% CA%affirmed.%
•% They% found% no% sufficient% ground% for% the% granting% of%
injunctive% relief% on% the% basis% of% the% testimonial% and%
removal%or%cancellation%of%the%word%"PHILIPS"%from%Private%
Respondent's%corporate%name.%
%
Issue:% Whether% the% writ% of% preliminary% injunction% should% be%
issued.%(Yes)%
%
•% A%corporation's%right%to%use%its%corporate%and%trade%name%
is%a%property%right,%a%right%in%rem,%which%it%may%assert%and%
protect% against% the% world% in% the% same% manner% as% it% may%
protect% its% tangible% property,% real% or% personal,% against%
trespass%or%conversion.%It%is%regarded,%to%a%certain%extent,%
as%a%property%right%and%one%which%cannot%be%impaired%or%
defeated% by% subsequent% appropriation% by% another%
corporation%in%the%same%field.%%
•% The%right%to%the%exclusive%use%of%a%corporate%name%arises%
when%the%following%requisites%are%present:%
(1)%that%the%complainant%corporation%acquired%a%prior%right%
over%the%use%of%such%corporate%name`%and%
(2)%the%proposed%name%is%either:%
(a)%identical%or%
(b)%deceptively%or%confusingly%similar%to%that%of%any%
existing% corporation% or% to% any% other% name% already%
protected%by%law`%or%
(c)% patently% deceptive,% confusing% or% contrary% to%
existing%law.%
%
•% In%this%case,%there%is%no%doubt%with%respect%to%PRBV's%
prior% adoption% of% the% name% "PHILIPS"% as% part% of% its%
$
corporate% name.% Petitioners% Philips% Electrical% and% WHEREFORE,%the%Decision%of%the%Court%of%Appeals%and%
Philips%Industrial%were%incorporated%on%29%August%1956% its% Resolution% are% SET% ASIDE% and% a% new% one% entered%
and% 25% May% 1956,% respectively,% while% Respondent% ENJOINING% private% respondent% from% using% "PHILIPS"% as% a%
Standard% Philips% was% issued% a% Certificate% of% feature%of%its%corporate%name,%and%ORDERING%the%Securities%and%
Registration% on% 19% April% 1982,% twentyZsix% (26)% years% Exchange%Commission%to%amend%private%respondent's%Articles%of%
later% Petitioner% PEBV% has% also% used% the% trademark% Incorporation% by% deleting% the% word% PHILIPS% from% the% corporate%
"PHILIPS"% on% electrical% lamps% of% all% types% and% their% name%of%private%respondent.%
accessories% since% 30% September% 1922,% as% evidenced% %
by%its%Certificate%of%Registration.% Armco%Steel%Corporation%v.%SEC,%156%SCRA%822%
%
•% The% second% requisite% no% less% exists% in% this% case.% In%
Facts:%
determining% the% existence% of% confusing% similarity% in%
1.% ARMCO%Steel%Corporation%obtained%from%the%Philippine%
corporate% names,% the% test% is% whether% the% similarity% is%
Patent%Office%a%Certificate%of%Registration%for%its%
such%as%to%mislead%a%person%using%ordinary%care%and%
trademark%consisting%of%the%word%"ARMCO"%and%a%
discrimination.% While% the% corporate% names% of%
triangular%device%for%"ferrous%metals%and%ferrous%metal%
Petitioners%and%Private%Respondent%are%not%identical,%a%
castings%and%forgings.%
reading% of% Petitioner's% corporate% names,% to% wit:%
2.% ARMCO%MarsteelZAlloy%Corporation%was%also%
PHILIPS% EXPORT% B.V.,% PHILIPS% ELECTRICAL%
incorporated%on%July%11,%1972%under%its%original%name%
LAMPS,% INC.% and% PHILIPS% INDUSTRIAL%
Marsteel%Alloy%Company,%Inc.%but%on%March%28,%1973%its%
DEVELOPMENT,% INC.,% inevitably% leads% one% to%
name%was%changed%to%ARMCOZMarsteel%Alloy%
conclude%that%"PHILIPS"%is,%indeed,%the%dominant%word%
Corporation.%Both%said%corporations%are%engaged%in%the%
in% that% all% the% companies% affiliated% or% associated% with%
manufacture%of%steel%products.%Its%article%of%incorporation%
the% principal% corporation,% PEBV,% are% known% in% the%
in%part%reads%as%follows%as%to%its%purposes:%"to%
Philippines% and% abroad% as% the% PHILIPS% Group% of%
manufacture,%process%...%and%deal%in%all%kinds,%form,%and%
Companies.% Although% the% products% of% Standard% and%
combinations%of%iron,%steel%or%other%metals%and%all%or%any%
Philips%are%different,%the%court%ruled%that%based%on%its%
products%or%articles%particularly%consisting%of%iron,%steel%or%
primary%purpose,%nothing%could%prevent%it%from%dealing%
other%metals.%
in% the% same% line% of% business% of% electrical% devices,%
3.% On%the%other%hand%ARMCO%Steel%Corporation%was%
products% or% supplies% which% fall% under% its% primary%
incorporated%in%the%Philippines%on%April%25,%1973.%A%
purposes.%
pertinent%portion%of%its%articles%of%incorporation%provides%
%
as%among%its%purposes:%"to%contract,%fabricate%...%
manufacture%...%regarding%pipelines,%steel%frames%...%."%
$
4.% ARMCOZOhio%and%ARMCOZMarsteel%then%filed%a%petition%
in%the%Securities%and%Exchange%Commission%(SEC)%to%
compel%ARMCOZPhilippines%to%change%its%corporate%
name%on%the%ground%that%it%is%very%similar,%if%not%exactly%
the%same%as%the%name%of%one%of%the%petitioners%
5.% SEC%granted%the%petition.%
6.% Motion%for%reconsideration%was%denied%and%Appeal%was%
also%dismissed.%
7.% Respondent%amended%its%articles%of%incorporation%by%
changing%its%name%to%"ARMCO%structures,%Inc."%which%
was%filed%with%and%approved%by%the%SEC.%
% ARMCOZSTEELZOHIO.%Clearly,%the%two%companies%have%
Issue:%
WON%there%is%confusing%similarity%between%the%corporate%names%
of%respondents%and%the%new%name%of%petitioner%
% as%that%of%ARMCO%STEELZ%OHIO.%People%who%are%buying%
Held:%
•% YES%THERE%IS%
•% The%order%of%the%public%respondent%SEC%of%February%14,%
1975%which%has%long%become%final%and%executory%clearly%
spells%out%that%petitioner%must%"take%out%ARMCO%and%
substitute%another%word%in%lieu%thereof%in%its%corporate%
name%by%amending%the%articles%of%incorporation%to%that%
effect,%...%."%Far%from%complying%with%said%order%petitioner%
amended%its%corporate%name%into%ARMCO%Structures,%
Inc.,%and%secured%its%approval%by%the%SEC%on%March%22,%
1976.%The%Court%finds%that%the%said%amendment%in%the%
corporate%name%of%petitioner%is%not%in%substantial%
compliance%with%the%order%of%February%14,%1975.%Indeed%it%
is%in%contravention%therewith.%
•% By%mere%looking%at%the%names%it%is%clear%that%the%name%of%
petitioner,%ARMCO%STEEL%CORPORATION%(of%Ohio,%
U.S.A.),%and%that%of%the%respondent,%ARMCO%STEEL%
CORPORATION,%are%not%only%similar%but%Identical%and%
the%words%"of%Ohio,%U.S.A.,"%are%being%used%only%to%
Identify%petitioner%ARMCO%STEELZOHIO%as%a%U.S.%
corporation.%
•% It%is%indisputable%that%ARMCOZSTEELZOHIO,%having%
patented%the%term%'Armco'%as%part%of%its%trademark%on%its%
steel%products,%is%entitled%to%protection%in%the%use%thereof%
in%the%Philippines.%The%term%"Armco"%is%now%being%used%
on%the%products%being%manufactured%and%sold%in%this%
country%by%ArmcoZMarsteel%by%virtue%of%its%tieZup%with%
the%right%to%the%exclusive%use%and%enjoyment%of%said%term.%
•% ARMCO%STEELZPHILIPPINES,%has%not%only%an%Identical%
name%but%also%a%similar%line%of%business,%as%shown%above,%
and%using%products%bearing%the%trademark%"Armco"%might%
be%led%to%believe%that%such%products%are%manufactured%by%
the%respondent,%when%in%fact,%they%might%actually%be%
produced%by%the%petitioners.%Thus,%the%goodwill%that%
should%grow%and%inure%to%the%benefit%of%petitioners%could%
be%impaired%and%prejudiced%by%the%continued%use%of%the%
same%term%by%the%respondent.%
•% Obviously,%the%petition%for%review%is%designed%to%further%
delay%if%not%simply%evade%compliance%with%the%said%final%
and%executory%SEC%order.%Petitioner%also%seeks%a%review%
of%the%orders%of%execution%of%the%SEC%of%the%said%
February%14,%1975%order.%An%order%or%resolution%granting%
execution%of%the%final%judgment%cannot%be%appealed%9%
otherwise%there%will%be%no%end%to%the%litigation.%
$
WESTERN%EQUIPMENT%AND%SUPPLY%COMPANY%vs.%CA% high%trade%reputation%throughout%the%world.%Also,%it%has%acquired%
a%valuable%goodwill%and%high%reputation%in%the%PH,%through%sale,%
GR%No.%27897%–%Dec.%2,%1927%–%Johns% by% importers,% and% the% extensive% use% with% the% country% of% its%
% products% bearing% either% its% corporate% name% or% tradeZmark%
‘Western% Electric’.% The% words% ‘Western% Electric’% have% been%
SUBJECT:%Tradenames`%right%of%the%tradename%owner.%% registered% by% Western% Electric% as% a% tradeZmark% under% the%
provisions%of%the%Act%of%Congress%of%Feb.%20,%1905,%in%the%office%
%
of% the% Commissioner% of% Patents% at% Washington,% DC,% and% said%
FACTS:% mark%remains%in%force%as%the%property%of%said%plaintiff%to%this%date.%%

Western%Equipment%and%Supply%Company%(plaintiff)%is%a%foreign% %
corporation%organized%under%the%laws%of%the%State%of%Nevada.%On%
A%Philippine%corporation%known%as%the%Electric%Supply%Company,%
or% about% May% 4,% 1925,% through% its% duly% authorized% agent,% Felix%
Inc.,’% has% been% importing% the% manufactures% of% Western% Electric%
Reyes% (plaintiff),% Western% Equipment% applied% to% Fidel% Reyes%
into%the%Philippines%for%the%purpose%of%selling%the%same%therein.%
(defendant),% the% Director% of% the% Bureau% of% Commerce% and%
Defendant%Henry%Herman%is%the%President%and%General%Manager%
Industry,%for%the%issuance%of%a%license%to%engage%in%business%in%
of%said%corporation.%%
the%Philippines.%On%May%20,%1926,%said%director%issued%in%favor%of%
Western%Equipment%a%provisional%license%for%that%purpose%which% %
was%made%permanent%on%Aug.%23,%1926.%%
On%October%15,%1926,%Defendants%Henry%Herman,%Peter%O’Brien,%
% Manuel%Diaz,%Felipe%Mapoy%and%Artemio%Zamora%signed%and%filed%
articles%of%incorporation%with%defendant%Fidel%Reyes,%the%Director%
Since% May% 20,% 1926,% Western% Equipment% has% been% and% still% is%
of% the% Bureau% of% Commerce% and% Industry,% with% the% intention% of%
engaged%in%importing%and%selling%in%the%Philippines%electrical%and%
organizing%a%domestic%corporation%under%the%PH%Corporation%Law%
telephone% apparatus% and% supplies% manufactures% by% Western%
to% be% known% as% the% ‘Western% Electric% Company,% Inc.’% for% the%
Electric%Company,%also%a%foreign%corporation%organized%under%the%
purpose,% among% other% things,% of% manufacturing,% buying,% selling%
laws%of%the%State%of%New%York.%%
and%dealing%generally%in%electrical%and%telephone%apparatus%and%
% supplies.%The%filing%was%done%with%knowledge%of%the%existence%of%
the% plaintiff% Western% Electric% Company,% Inc.,% of% its% corporate%
Western%Electric%Company%has%never%been%engaged%in%business% name,%of%its%tradeZmark,%‘Western%Electric’%and%of%the%fact%that%the%
in%the%Philippines.%It%is%a%manufacturer%of%electrical%and%telephone% manufactures%of%said%plaintiff%bearing%its%tradeZmark%or%corporate%
apparatus% and% supplies% which% have% been% sold% in% foreign% and% name%are%in%general%use%in%the%PH%and%in%the%US.%%
interstate% commerce% for% the% past% 50% years,% and% have% acquired%
$
% %
On% Oct.% 18,% 1926,% plaintiff% W.Z.% Smith,% President% and% General%
Manager%of%Western%Equipment,%lodged%with%the%Director%of%the%
Bureau% of% Commerce% and% Industry% its% protest% against% the%
registration%of%the%proposed%incorporation%by%the%defendants%upon%
the%ground%among%others,%that%the%corporate%name%by%which%said%
defendants% desire% to% be% known,% being% identical% with% that% of% the%
plaintiff% Western% Equipment% and% Supply% Company,% will% deceive%
and% mislead% the% public% purchasing% electrical% and% telephone%
apparatus%and%supplies.%%
On%Oct.%20,%1926,%plaintiff%Smith%filed%a%written%application%for%the%
issuance%of%a%license%to%engage%in%business%in%the%PH%with%the%
defendant%Director%of%the%Bureau%of%Commerce%and%Industry.%
%
The%Director%of%the%Bureau%of%Commerce%and%Industry%announced%
his% intention% to% overrule% said% protest% and% will,% unless% judicially%
restrained% therefrom,% issue% to% the% other% defendants% herein% a%
certificate% of% incorporation,% constituting% said% defendants% a% PH%
body% politic% and% corporate% under% the% name% of% ‘Western% Electric%
Company,%Inc.’%
%
CFI:%ruled%in%favor%of%the%plaintiffs.%%
% the%corporate%name%of%the%foreign%corporation%and%of%engaging%in%
ISSUE:% WON% a% foreign% company,% which% has% never% engaged%
business% in% the% PH,% can% restrain% a% Philippine% citizen% from%
organizing%a%corporation%bearing%the%same%name%as%such%foreign%
corporation?%%
HELD:%Yes.%%
A%foreign%corporation%which%has%never%done%any%business%in%the%
Philippine%Islands%and%which%is%unlicensed%and%unregistered%to%do%
business%here,%but%is%widely%and%favorably%known%in%the%Islands%
through%the%use%therein%of%its%products%bearing%its%corporate%and%
trade%name,%has%a%legal%right%to%maintain%an%action%in%the%Islands%
to%restrain%the%residents%and%inhabitants%thereof%from%organizing%
a% corporation% therein% bearing% the% same% name% as% the% foreign%
corporation,%when%it%appears%that%they%have%personal%knowledge%
of%the%existence%of%such%a%foreign%corporation,%and%it%is%apparent%
that%the%purpose%of%the%proposed%domestic%corporation%is%to%deal%
and%trade%in%the%same%goods%as%those%of%the%foreign%corporation.%
%
%
An% unregistered% foreign% corporation% which% has% not% personally%
transacted% business% in% the% Philippine% Islands,% but% which% has%
acquired% valuable% goodwill% and% high% reputation% therein% through%
the%sale%by%importers%and%the%extensive%use%within%the%Islands%of%
its%products%bearing%either%its%corporate%name%or%trade mark,%has%
a%legal%right%to%restrain%an%officer%of%the%Government,%who%has%full%
knowledge% of% those% facts,% from% issuing% a% certificate% of%
incorporation% to% residents% of% the% Philippine% Islands% who% are%
attempting%to%organize%a%corporation%for%the%purpose%of%pirating%
the%same%business,%for%the%purpose%of%making%the%public%believe%
that% the% goods% which% it% proposes% to% sell% are% the% goods% of% the%
foreign% corporation% and% of% defrauding% it% and% its% local% dealers% of%
their%legitimate%trade.%%
$
% same%identical%purpose%as%that%of%the%plaintiff,%is%to%trespass%upon%
and% profit% by% its% good% name% and% business% reputation.% The% very%
The%purpose%of%such%a%suit%is%to%protect%its%reputation,%corporate% fact%that%Herman%and%his%associates%have%sought%the%use%of%that%
name% and% goodwill% which% have% been% established% through% the% particular%name%for%that%identical%purpose%is%conclusive%evidence%
natural%development%of%its%trade%over%a%long%period%of%years,%in% of%the%fraudulent%intent%with%which%it%is%done.%%
the%doing%of%which%it%does%not%seek%to%enforce%any%legal%or%contract%
rights%arising%from,%or%growing%out%of,%any%business%which%it%has% %
transacted%in%the%Philippine%Islands.%%
Judgment%of%the%lower%court%is%affirmed.%%
%
%
Under%such%a%state%of%facts,%the,%right%to%the%use%of%the%corporate%
and%trade%name%of%a%foreign%corporation%is%a%property%right,%a%right%
in"rem,"which%it%may%assert%and%protect%in%any%of%the%courts%of%the%
world%even%in%countries%where%it%does%not%personally%transact%any%
business.%%

In% such% a% case,% it% is% the% trade% and% not% the% mark% that% is% to% be%
protected,%a%tradeZmark%acknowledges%no%territorial%boundaries%of%
municipalities%or%states%or%nations,%but%extends%to%every%market%
where%the%trader’s%goods%have%become%known%and%identified%by%
the%use%of%the%mark.%%

Western% Electric% Company,% Inc.,% has% been% in% existence% as% a%

corporation%for%over%50%years,%during%which%time%it%has%established%
a%reputation%all%over%the%world%including%the%Philippine%Islands,%for%
the% kind% and% quality% of% its% manufactured% articles.% It% is% very%
apparent% that% the% whole% purpose% and% intent% of% Herman% and% his%
associates% in% seeking% to% incorporate% another% corporation% under%
the%identical%name%of%Western%Electric%Company,%Inc.,%and%for%the%